GrubHub Inc Prices IPO At $26, Valuing It $2.04 Billion

GrubHub Inc Prices IPO At $26, Valuing It $2.04 Billion

GrubHub Inc (NYSE:GRUB) has announced the initial public offering of 7,405,614 of its common stock at a price of $26.00 per share, which values the company at $2.04 billion. Initially, GrubHub expected the shares to be priced between $20 and $22 per share, but later it raised the bar to between $23 and $25 per share. Shares will be trading on the New York Stock Exchange (NYSE) starting today.

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30-day option offered to underwriters

GrubHub Inc (NYSE:GRUB) has offered underwriters a 30-day option to purchase up to an additional 1,110,842 shares from certain stockholders at the initial public offering price. The largest U.S. online food delivery services company has hired Citigroup and Morgan Stanley as joint book-running managers for the offering. Allen & Company LLC, BMO Capital Markets Corp., Canaccord Genuity Inc., Raymond James & Associates, Inc., and William Blair & Company, L.L.C. have been hired as co-managers for the offering.

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GrubHub Inc (NYSE:GRUB) filed a registration statement for the securities on April 3, 2014, which was declared effective by the U.S. Securities and Exchange Commission (SEC).

A big event at a right time for GrubHub

GrubHub Inc (NYSE:GRUB), which was formed by the merger of Chicago-based GrubHub and New York’s Seamless, is expecting to capitalize on successful recent technology IPOs. GrubHub is just a decade-old company, and issuing an IPO at this stage is a big event for the company and also for Chicago’s tech community. Two other largely traded tech stocks in the same arena are Groupon Inc (NASDAQ:GRPN), the deal-focused company valued at $5.4 billion, and Envestnet Inc (NYSE:ENV), which makes software for financial firms and is valued at $1.35 billion. The IPO from GrubHub is one of the most-awaited events of the week, and experts believe that the timing of the IPO is also advantageous. Nine companies were expected to come out with their IPO this week.

GrubHub Inc (NYSE:GRUB)’s main area of work is coordinating the takeout orders for independent restaurants. The service is becoming increasingly popular with the rise in the trend of placing restaurants orders online instead of by phone. According to Darren Tristano, executive vice president at restaurant industry consultancy Technomic, this is a trendy business, and the number of investors who already know about the service or have used it will give some benefit to this IPO issue.

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Aman is MBA (Finance) with an experience on both Marketing and Finance side. He has worked as a Risk Analyst for AIR Worldwide, and is currently leading VeRa FinServ, a Financial Research firm. Favorite pastimes include watching science fiction movies, reviewing tech gadgets, playing PC games and cricket. - Email him at
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