Deliveroo targets IPO valuation of up to £8.8bn

Deliveroo has set a price range for its flotation, with the food delivery group targeting a market capitalisation of between £7.6bn and £8.8bn, as it seeks to invest in growth opportunities.

The company said on Monday that it would sell shares at between £3.90 and £4.60. At the midpoint of the range, the equity would be valued at £8.2bn.

Around 384m shares will be sold in the initial public offering, worth £1.6bn at the midpoint of the price range. Of that, around £1bn has been earmarked for the company itself with the rest going to existing investors who are selling shares.

The company, which has benefited from lockdown demand for takeaways, plans to use the proceeds to invest in growth opportunities.

“The way we think about it is simple: there are 21 meal occasions in a week — breakfast, lunch, and dinner — seven days a week,” the group said. “Right now, less than one of those 21 transactions takes place online. We are working to change that,” it said in a statement on Monday.

The company also put out a trading update for the first two months of 2021. It said that the total value of transactions on its platform had more than doubled compared with the same period last year.