Morning Report: Pivotal Software has priced its IPO at $15 per share, the midpoint between the poles of its indicated range of $14 to $16 per share.
Good morning and welcome back to IPO Friday. Today, Pivotal Software.
As expected, the company priced its IPO heading into today’s trading cycle. At $15 per share, the company’s 33.1 million selling shares will bring it $496.8 million. General Electric can expect to collect $58.2 million from its own 3.8 million shares sold in the debut.
That Pivotal priced mid-range isn’t too surprising. Despite some recent IPOs pricing above their anticipated ranges, Pivotal’s dramatically slowing revenue growth, service-heavy top line mix, and modest aggregate gross margin made it an interesting company to price.
Using our prior estimates, the company is worth around $3.25 billion, give or take a few million. (It’s early!) That gives Pivotal Software a trailing revenue multiple of around 6.4. That’s a slightly spicy result given that it’s ahead of some similarly-sized SaaS companies’ own revenue multiples, firms that have higher percentages of recurring revenue, and more.
Regardless, this is another IPO all but done. More when it starts trading.
From The Crunchbase Daily:
Another really big software IPO is hitting the market. Pivotal, a cloud-based app development platform, priced shares for its initial offering at $15 each, the middle of its projected range, raising about $550 million. The offering follows a period of large but shrinking losses and slowing revenue growth for the San Francisco-based company.
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