Twitter raised the price range for its initial public offering as it seeks to raise up to $1.75 billion, signaling strong demand for the most closely watched IPO since Facebook’s last year.
Twitter expects to sell 70 million shares at $23 to $25 each, up from a prior estimate of $17 to $20, it said in a filing with the US Securities and Exchange Commission.
The new pricing would value the company at up to $13.6 billion, compared with up to about $11 billion under the previous range. The IPO is set to price on Wednesday, with shares trading on the New York Stock Exchange on Thursday.
Twitter’s IPO is fully subscribed, meaning it has attracted more than enough investor interest, according to a source familiar with the offering.
The company plans to close the books on the IPO a day earlier than scheduled, on Tuesday, because of strong demand for its shares, according to two sources with knowledge of the process.
“This is not a surprise,” said senior analyst Kim Forrest of Fort Pitt Capital Group, which manages $1.5 billion in assets. “The people underwriting the IPO have a responsibility to the company selling these shares to extract the highest price it can. It has to walk a fine line to make it attractive to investors.”
IBM patent squabble
The company also said that it had received a letter from IBM alleging Twitter infringed at least three of its US patents.
IBM has “invited” Twitter to “negotiate a business resolution of the allegations”.
The patents in question involve “programmatic discovery of contacts”, “efficient retrieval of uniform resource locators,” and a “method for presenting advertising in an interactive service”.
Twitter’s filing said it had “meritorious defenses” to the allegations.
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