Reddit’s IPO, aiming for a valuation of US$6.5 billion, is reportedly oversubscribed by as much as five times as it attracts investor interest, according to sources cited by Reuters. The social media company plans to set the IPO price this Wednesday.
Last week’s regulatory filing revealed Reddit’s intention to offer about 15.3 million shares, with a price range of US$31 to $34 each. Additionally, existing investors plan to sell 6.7 million more shares, potentially raising up to US$748 million when combined with the new stock.
However, this high level of oversubscription doesn’t necessarily predict a successful debut on the New York Stock Exchange. Notably, Reddit was valued at US$10 billion following a private fundraising round in 2021.
Despite its popularity, Reddit, known for its user-generated, voluntarily moderated content, has recorded losses annually since its inception in 2005.
The marketing of the IPO is still underway, as per Reuters. About 8% of the shares are being reserved for specific groups, including eligible users, to engage retail investors.
