TORONTO, ON / ACCESSWIRE / January 7, 2021 / Hamilton Chukyo Brokerage has today said that online gaming company Roblox received a company valuation of $29.5 billion following a capital raising and announced it would go public via a direct listing, in a change of plans after several eagerly-received initial public offerings triggered concerns about the share-pricing process.
"Roblox announced it would file a registration statement with the Securities and Exchange Commission for a direct listing on the stock market. The company has not confirmed how many shares will be available for immediate trading," commented Michael Williams, Head of Private Wealth Management at Hamilton Chukyo Brokerage.
The video game platform's announcement marks a rare instance where a company publicly shifts from a traditional IPO to a direct listing, an alternative route to public markets that some backers claim is more efficient and leads to a fairer price for the shares of a company.
Roblox initially filed for an IPO that advisers expected to launch before the festive season last year. But it later reversed direction following impressive first-day gains in listings by Doordash Inc. and Airbnb Inc.
Roblox would join a small but increasing number of businesses preferring a direct listing. On the same day in September last year, both the workplace collaboration firm Asana and big data analytics group Palantir went public via the alternative process.
"Investors led by Altimeter Capital and Dragoneer Investment Group had invested $520m in Roblox, resulting in a company valuation of $29.5 billion, including the new capital," commented Anthony Roberts, Head of Institutional Trading at Hamilton Chukyo Brokerage.
The new figure represents more than a seven-fold increase from the valuation investors assigned Roblox back in February, underlining the company's rapid growth through the coronavirus lockdowns.
According to data gathered by Hamilton Chukyo Brokerage, during the first three quarters last year, Roblox earned almost $1.2 billion from selling its virtual currency to gamers.
Before a direct listing, start-ups often raise large rounds of financing in lieu of the proceeds they would typically receive from an IPO. Roblox said investors agreed to buy shares at $45 each, a price that could help guide the company's stock on the first day of trading.
JPMorgan, Goldman Sachs and Morgan Stanley acted as lead underwriters on Roblox's prospective IPO last year.
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Hamilton Chukyo Brokerage provides financial advice and asset management services to private, institutional and corporate clients worldwide.
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SOURCE: Hamilton Chukyo Brokerage
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