eToro has announced plans for its long-anticipated initial public offering (IPO), targeting a valuation of up to $4 billion. The company aims to raise up to $500 million by offering 10 million shares priced between $46 and $50 each.
This move marks a significant milestone for eToro as it prepares for its debut on the Nasdaq Global Select Market under the ticker symbol “ETOR.”
eToro Launches IPO Roadshow
The IPO roadshow has officially launched, with eToro and existing stockholders offering 10 million Class A common shares—5 million from eToro and 5 million from other shareholders.
To accommodate potential demand, eToro plans to grant underwriters a 30-day option to purchase an additional 1.5 million shares to cover over-allotments.
Leading the offering are Goldman Sachs & Co. LLC, Jefferies, UBS Investment Bank, and Citigroup, who are acting as the primary book-running managers. Additional support comes from a consortium of firms including Deutsche Bank Securities and BofA Securities, among others.
A registration statement on Form F-1 regarding the proposed offering has been filed with the Securities and Exchange Commission (SEC) but has not yet become effective.
This means that no shares can be sold, nor can offers to buy be accepted, until the registration statement is approved. The offering will comply with the requirements of the Securities Act of 1933, ensuring that all regulatory protocols are followed.
BlackRock To Invest Up To $100 Million
eToro’s listing is seen as a litmus test for investor appetite for new stock offerings, especially following a period of market volatility. The company had previously postponed investor presentations due to unfavorable market conditions.
Analysts suggest that, given the current climate, investors may be looking for significant discounts on shares, which could impact eToro’s pricing strategy.
Jeff Zell, a senior research analyst at IPO Boutique, noted that the firm’s success will depend on its ability to effectively communicate its growth potential in a competitive market.
Founded in 2007, eToro has become a popular platform for retail investors, allowing users to trade stocks and cryptocurrencies. However, the company faced regulatory scrutiny last year, leading to a settlement with the SEC that restricted its US crypto offerings to only Bitcoin (BTC), Bitcoin Cash (BCH), and Etherereum (ETH). This decision came after allegations that eToro operated as an unregistered broker and clearing agency.
In 2023, eToro raised $250 million in a funding round, valuing the company at $3.5 billion. Notably, asset management giant BlackRock has shown interest in the upcoming IPO, signaling its intention to purchase up to $100 million worth of shares.
Featured image from DALL-E, chart from TradingView.com