A month after the rumor mill began swirling with ideas that Snap — the parent company of quick-photo messaging app Snapchat — would file for an initial public offering, the tech company has officially filed papers to go public to the tune of $25 billion.
Reuters, citing sources familiar with the situation, reports that Snap confidentially filed for an initial public offering that would see the company going public as soon as March.
The filing was made with the Securities and Exchange Commission in recent weeks under the U.S. Jumpstart Our Business Startups Act. This, Reuters reports, allows a company with less than $1 billion in revenue to file confidentially to gauge investor interest.
With an estimated value between $20 billion to $25 billion, the IPO would be the largest by a company since Alibaba’s offering of $170 billion in 2014.
News of the confidential filing comes more than a month after the company was rumored to have hired Morgan Stanley and Goldman Sachs to handle its pre-filing process.
Snapchat, which brings in the bulk of its revenue from advertisements in filters and promoted stories, could use the funds from an IPO for acquisitions of virtual-reality companies.
Such a move would make sense, the sources say, after the company recently changed its name to Snap in order to be seen as more than a messaging service, and announced it would launch sunglasses equipped with video cameras.
Snapchat files for one of the biggest tech IPOs in years: sources [Reuters]
by Ashlee Kieler via Consumerist