Used car marketplace Vroom set a price range of between $15 and $17 per share for its IPO, according to an updated filing with the U.S. Securities and Exchange Commission.
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The company is offering 18.75 million shares. If it prices at the top end of the range, it would raise $318.8 million with a market cap of about $1.92 billion.
Vroom sells used, refurbished cars to customers online and through its app, and it handles picking up the vehicle from the seller and delivering it to the buyer. It also has insurance, financing and warranty products.The company last raised $254 million in December 2019, in a Series H round led by Durable Capital Partners LP.
The company reported revenue of $375.8 million for the first quarter with a net loss of $27.1 million, according to its S-1. Year over year, its revenue is up (from $235.1 million in Q1 2019) and its losses are shrinking (from $41.1 million in Q1 2019).
It’s unclear how the COVID-19 pandemic will affect the company’s performance this year. Vroom wrote in its filing that it “expects that its operations will continue to be adversely impacted throughout 2020 and potentially beyond, however, the magnitude and duration of the ultimate impact is impossible to predict with certainty.”
Last month the company placed about a third of its team on furlough and cut pay for non-furloughed salaried employees.
Vroom filed to go public during an otherwise quiet IPO period. Few companies have been going public since the COVID-19 pandemic escalated in March, with mostly pharmaceutical and medical-related companies taking that step. ZoomInfo is another rare IPO filing during this strange period.
Vroom, which is based in New York, plans to list on the Nasdaq under the ticker symbol “VRM.” The company hired Bank of America Securities, Goldman Sachs, Allen & Co. and Wells Fargo as underwriters.
Illustration Credit: Li-Anne Dias