Airbnb closing in on IPO filing as travel rebounds
Airbnb Inc. plans to file paperwork for a stock market listing in the next few weeks paving the way for its shares to start trading as soon as the fourth quarter, according to people familiar with the matter.
The San Francisco-based company is preparing to submit documents confidentially with the U.S. Securities and Exchange Commission for an initial public offering, said the people, who asked to not be identified discussing private information. The long-awaited move would represent a swift comeback for the home-sharing platform after the COVID-19 pandemic sent the travel industry into a tailspin.
The Wall Street Journal reported earlier that Airbnb was planning to file paperwork later this month. Airbnb declined to comment on the matter. The company’s plans could change as new outbreaks of the disease continue to flare in the U.S., the people said.
Airbnb is working with Morgan Stanley and Goldman Sachs Group Inc. on its IPO, according to a person familiar with the matter. Morgan Stanley and Goldman Sachs declined to comment.
Chief Executive Brian Chesky had originally wanted to take the initial steps toward a listing in March, but his plans were nixed by COVID-19. By April, Chesky was facing $1 billion in cancellations, he said in an interview with Bloomberg TV in June. Travel bans and lockdowns caused planned bookings to tumble about 90% and Airbnb cut 25% of its workforce to survive. Other travel sites, such as TripAdvisor Inc. and Booking Holdings Inc., also hit crisis mode and had to eliminate thousands of jobs.
But by May, Airbnb was already seeing a rebound. The number of nights booked at U.S. listings from May 17 to June 3 was greater than during the same period the previous year, as city dwellers took advantage of work-from-home policies and escaped apartments for nearby vacation rentals. As of June 17, Airbnb’s bookings had increased 20% year over year in the U.S., according to data from market research firm AirDNA.
Prior to the pandemic, Airbnb had been leaning toward a nontraditional route to the public markets. The company was planning to follow in the footsteps of Spotify Technology and list directly, forgoing raising new money by selling shares and allowing its investors to put their shares on the market without waiting for a lock-up period.
But the turmoil caused by the pandemic forced Airbnb to raise $2 billion in debt and equity securities in April to shore up its finances, reducing its valuation to $18 billion from $31 billion. As a result, the company decided to go the traditional IPO route to raise cash for the business, the people said.