Twitter is now ready to embark in the trade business as it recently placed a $1B IPO to investors. There is no official news on which stock exchange market it will deal with but it has confirmed to use the trade name symbol TWTR. J.P. Morgan and Morgan Stanley lead the list of carrier banks while Goldman Sachs will act as top underwriter. The company has unveiled information that it had already filed its IPO application with the Securities and Exchange Commission although the details are still undisclosed to the public. The filing with the SEC now makes Twitter an official trader and will likely be on the list on November 9.
Ready to invite public
Reports indicate that Twitter, based on a $253 million income from the first part of 2013, lost a net worth of $69 million which is a far better performance from its earlier $49 million net loss against $122 million takings. Twitter users have accordingly increased also, jumping from 151 million in 2012 to 218 million in 2013. With these figures on hand, the company apparently believes it is time to open its doors to public investments.
Chief shareholder
Social media observers believe that Ev Williams who co-established Twitter, will be the highest single shareholder. Williams is on a 12% position while his colleague Jack Dorsey who is the acting chairman is presently positioned with a 4.9% claim. On the other hand Dick Costolo, CEO, has a 1.6% investment share. Biz Stone, another Twitter co-founder is not in the list of main shareholders although he is believed to have a 5% stake.
Benefits for employees and the public
The timely IPO move by Twitter is expected to promote the interests of its 1,800 employees who are indirect beneficiaries of the trade profits. Since these workers are part of the company they are said to have an advantage over other investors from the public because they can comfortably monitor market activities from their own desks. Apart from their opportunity to invest, company employees will become wealthier through bonuses and perks as Twitter anticipates increased assets. CEO Costolo reportedly earned an estimated $11.5 million in 2012. More business institutions are currently posturing with 5% stake and these are Spark Capital, Benchmark Capital, Rizvi Traverse, DST Global and Union Square Ventures.
Government deadlock
The business sector seems confident that Twitter’s joining the trade business will further boost the company’s financial status and at the same time heighten the interest of small and big investors to place their outlay. There might be a chance however that this step will be encumbered by the ongoing deadlock in the government. Although the Securities and Exchange Commission is working hard to keep the market in place, there is a possibility of cutting back on some provisions. In this case Twitter may have to make adjustments in its offer and will have to wait for a certain period of time until its bid is accepted. The share pricing may also suffer a setback in view of the current government shutdown.
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