Grocery delivery app Instacart raised its proposed price range for its initial public offering (IPO) on Friday, revising its terms to target a fully-diluted valuation of up to US$10-billion after a stellar debut for Arm Holdings ARM-Q.
The price hike signals robust investor demand for the San Francisco-based company, which is looking to list its shares this month after years of waiting in the wings.
September is gearing up to be one of the busiest spells for new listings.
Shares of SoftBank’s chip designer Arm were up nearly 3 per cent in volatile early trade on Friday, extending gains from their strong close on the first day of trading.
Another portfolio company of the Japanese investment giant, Neumora Therapeutics, is set to start trading, while marketing firm Klaviyo is looking to list in the next few weeks.
Traditional U.S. IPOs have raked in more than US$5-billion so far in September, according to data from Dealogic, already the second biggest month for such share offerings this year.
Instacart said 22 million shares will be sold at US$28 to US$30 each compared with its previous price range of US$26 to US$28 each. At the top end, the IPO will fetch $660-million compared with the earlier target of $616-million.
Of the total proceeds, up to US$237-million could go to existing Instacart investors looking to sell their shares.
The company’s raised valuation target, however, would still be just one-fourth of the US$39-billion it was worth after its last funding round more than two years ago.
Cornerstone investors have indicated they will buy up to US$400-million worth of shares, which would account for around two-thirds of the total proceeds if they were priced at the top end of the range.