Ride-hailing company Uber is aiming for a valuation of up to $91.5 billion in its initial public offering, potentially the largest US listing in years and a test of investor appetite for a high-growth but highly unprofitable business.
In a regulatory filing on Friday, Uber fixed a target price range of $44 to $50 per share for its IPO. The company will sell 180 million shares in the offering to raise up to $9bn, with a further 27 million sold by existing investors for as much as $1.35bn.
Uber also said PayPal had agreed to purchase $500 million of stock in a private placement at the price the IPO eventually settles at.
The updated public filing comes as Uber gears up to begin its investor road show, in which management will spend the coming days pitching Uber to public markets investors. Uber expects to price the IPO on May 9 and then begin trading on the New York Stock Exchange the following day, people familiar with the matter have said.
Uber will face a host of questions from investors, including when it will turn a profit, how it will navigate the transition to autonomous vehicles and whether its business model can support higher driver costs from minimum wage rules.
Underscoring the company's ability to generate revenue but also the scale of its losses, Uber reported in the filing a net loss attributable to the company for the first quarter of 2019 of around $1bn on sales of roughly $3bn.
"When it comes to Uber, we believe there are still questions over the current car-sharing model, the economics of which are not immediately or obviously attractive for sustainable, long-term investment," Mark Hargraves, head of Framlington Global Equities, wrote in a note.
The valuation that Uber is seeking in its IPO is less than the $120bn that investment bankers told Uber last year it could fetch, and closer to the $76bn valuation it attained in its last private fundraising round in 2018.
During Uber's IPO road show, chief executive Dara Khosrowshahi will be also tasked with convincing investors that he has successfully changed the company's culture and business practices after a series of embarrassing scandals over the last two years.
Those have included sexual harassment allegations, a massive data breach that was concealed from regulators, use of illicit software to evade authorities and allegations of bribery overseas.
