Saturday, March 2

New York based Vroom raises $467.5 million in US IPO

Online used car seller Vroom Inc raises $467.5 million in its initial public offering.

Applied for IPO last month, Vroom priced its IPO at $22 in the US stock exchange, above the initially marketed range of $18 to $20, valuing the company at $2.48 billion.

T Rowe Price Associates and L Catterton backed Vroom sold 21.25 million shares compared with the earlier plan of 18.8 million shares.

The shares will trend as a VRM under Nasdaq listing on Tuesday.

Recent recovery in the U.S. stock markets has led to a flurry of IPO-hopefuls entering the race.

Vroom reported a more than twofold rise in sales at its e-commerce business in the first quarter of 2020 as the virus outbreak and stay-at-home orders stoked a surge in online shopping.

The company, which use digital tools to close deals and home delivers vehicles to customers, said revenue for the first quarter ended March 31 jumped 60% from a year earlier, and net loss attributable to Vroom’s common stockholders narrowed to nearly $41.1 million from $45.1 million.

Rival Carvana Co, which saw its stock plunge nearly 80% in a month, has recovered dramatically to be up 26% on-year as online car selling gains favor in the post-pandemic world.

Tech-driven insurance startup Lemonade Inc, which counts Japan’s SoftBank Group Corp and Alphabet Inc’s venture capital arm GV among its investors, also filed for a U.S. listing on Monday.

Goldman Sachs, BofA Securities, Allen & Co and Wells Fargo Securities were the joint lead bookrunners of the offering.