Airbnb Inc is targeting to secure at least $3 billion in the group's forthcoming initial public offering, sources with knowledge of the matter disclosed Friday, capitalizing on the surprisingly strong recovery in its operations after the coronavirus crisis dealt a heavy blow on the travel sector.
The home rental startup is one of the much-awaited IPOs of 2020 and it nearly did not materialize after the pandemic brought global travel to a screeching halt. But the company was able to recover faster than it projected, as consumers sought rural rentals to avoid critical areas and make the most of their telecommute setup.
This year's blockbuster IPOs also featuring the likes of record company Warner Music Group, data analytics group Palantir Technologies and data warehouse firm Snowflake Inc. Airbnb disclosed in August that it had made a confidential filing to go public with the U.S. Securities and Exchange Commission.
Airbnb is also looking to make its IPO filing publicly available next month after the U.S presidential poll and is aiming for an IPO the following month, Reuters divulged on Friday, citing sources who requested anonymity as the transaction is subject to change based on current market and political conditions.
Sources said Airbnb could hit a valuation of over $30 billion in the listing, which would be essentially bigger compared to the $18 billion the startup was worth in April this year when it secured $2 billion in debt from investors. The home-sharing firm's most recent appraisal of the value of its shares pegged its value at roughly $21 billion.
The drive to penetrate the markets and the boost in the group's potential valuation underscores Airbnb's comeback from the first months this year. The outlook for the travel landscape then was uncertain and the company was able to secure a stimulus package. Airbnb heaved a sigh of relief as travelers opted for nearby pads instead of hotels during that time.
In the last two quarters, shares of U.S. online travel agency Booking Holdings, which some stakeholders of Airbnb use as a public market proxy for its own shares, have climbed over 35 percent.
Reuters reported last month that billionaire investor William Ackman had approached Airbnb about going public through a reverse merger with his blank-check company but that Airbnb was prioritizing going public through a traditional IPO.
Meanwhile, questions remain for the company, however. For instance, when will travel habits return to normal business? This will gauge whether its current bookings will set the stage for decent revenues.
