Amazon is set to trim down its stake in Deliveroo following the food delivery firm’s blockbuster initial public offering this year.
The ecommerce giant plans to sell around 23m shares as part of the stock market debut, allowing it to raise as much as £107m from the deal.
Its stake in Deliveroo will be reduced to 11.5 per cent from 15.8 per cent previously, according to a prospectus published by the company. This is partly due to dilution as a result of the IPO.
“We congratulate Deliveroo on their IPO and can confirm that on completion of the IPO, Amazon will still own a large proportion of our pre-IPO minority stake,” Amazon said in a statement.
It comes after Deliveroo priced its IPO at between £3.90 and £4.60 per share, giving it a target valuation of between £7.6bn and £8.8bn. It is aiming to raise around £1bn to invest in its expansion plans.
Amazon increased its stake in the company last year in a deal that had to be cleared by the UK competition watchdog. It also participated in a $180m private funding round in January that valued the firm at more than $7bn.
It is one of a number of backers set to win big from Deliveroo’s float, which could be the largest in London this year.
Investors who bought into the takeaway app back in 2013 will now have a stake worth £646, around 431 times their original investment according to data from MarktoMarket.
In September 2013 the company raised £115,001 from friends and family at £1.50 a share, valuing the company at around £1.5m.
It has grown rapidly since then, most recently cashing in on surging demand during coronavirus lockdowns.
Deliveroo this week said the total value of transactions processed more than doubled year on year in the first two months of 2021, driven by 130 per cent growth in the UK and Ireland.