Published: Mon, March 12, 2018
Money | By Armando Alvarado

Dropbox Announces Conditions for IPO

Dropbox Announces Conditions for IPO

In a filing with the SEC, Dropbox said it will sell 26.8 million Class A shares at United States dollars 16-18 each.

A series of funding rounds had valued Dropbox at $10 billion, but investment bankers were doubtful about matching that valuation.

Dropbox has set a preliminary price range for its initial public offering of shares, meaning net proceeds of around Dollars 530 million for the cloud storage company.

The midpoint of those pricing estimates would value the company at $7.5 billion.

The venture capital arm of Salesforce.com Inc (CRM.N) has agreed to buy $1 million of Dropbox's Class A common stock in a private placement at a price per share equal to the IPO.

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In the latest prospectus, the company sounded confident: "We believe the need for our platform will continue to grow as teams become more fluid and global, and content is increasingly fragmented across incompatible tools and devices".

This year has seen an early surge in public offerings with $8 billion of new stock sold in the U.S.in January alone, the biggest month since Alibaba raised $25 billion in its September 2014 IPO, according to data compiled by Bloomberg.

The San Francisco-based company has touted its business as a path to unleashing creative energy and inspired work. While it claims to have 500 million users in 180 countries, it posted only 11 million paying clients at the end of past year.

Dropbox disclosed in its initial S-1 form that it is not yet profitable, having lost $111.7 million in 2017.

Dropbox will list on NASDAQ under the stock ticker DBX. Goldman Sachs, J.P. Morgan, Deutsche Bank, Allen & Company, BofA Merrill Lynch, RBC Capital Markets, Jefferies and Macquarie Capital are the joint bookrunners on the deal.

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