In its latest SEC filing, GoDaddy has set an Initial Public Offering price range of $17 to $19 per share when it debuts on New York Stock Exchange, valuing the web hosting company at between $2.57B and $2.87 billion.
GoDaddy stated it will be offering 22 million shares of Class A common stock, which would raise between $374 million and $418 million based on their anticipated share price. This is significantly more than GoDaddy’s original aim to raise around $100 million according to the company’s S-1 filing in June 2014.
Earlier this year, GoDaddy announced plans to list on the NYSE under the symbol “GDDY” and that its IPO would be underwritten by Morgan Stanley, JPMorgan, Citi, Barclays, Deutsche, RBC, Stifel, and Piper.
In 2011, GoDaddy was acquired by a private equity consortium led by KKR & Co LP and Silver Lake Partners for $2.25 billion. KKR and Silver Lake each own 27.9 percent stakes, Technology Crossover Ventures (TCV) owns 12.6 percent, and company founder Bob Parsons owns approximately 28 percent. Following the IPO, the stakes KKR, Silver Lake, and Parsons will have in the company will drop to 23.9 percent, and TCV will hold 10.7 percent.
On the subject of the GoDaddy IPO, market research firm IPO Candy has noted that the company’s organizational structure could be of concern to investors. “Generally speaking, all the controlling entities of GoDaddy have been keen to take money out of the company, not in a bad way so far, but in the form of interest and distributions. They have put incentives in place for existing management, which are also self-serving. It remains to be seen how external equity investors will be treated.”
As Reuters notes, 2014 was a huge year for IPOs (with US IPOs raising the more money than any year since 2000) and 2015 has been relatively lukewarm so far with Box Inc. being one of the few technology companies launching IPOs. But GoDaddy, which has been in business since 1997 and currently manages around a fifth of all domains, is much more well-established than new technology upstarts.
In 2014, GoDaddy reported $1.39 billion in revenue, a 23 increase from 2013, as well as adding 1.1 million customers bringing its total clients to 12.7 million which bring in $114 per customer on average. Yet it also reported ending the year with $143.3 million in net losses, albeit less than the $200 million it lost the previous year.