Reports indicate that the online social networking site, LinkedIn, has filed an S-3 with the SEC in order to offer about $1 billion worth of Class A common stock. Based on the stock’s Aug. 30 closing price of $240.04, the offering would result in an increase of share counts for the company by 4,165,972 for a total of 97,732,877 outstanding shares of stock.
“The principles purposes of this offering are to increase our financial flexibility and to further strengthen our balance sheet,” management indicated in the filing. “We intend to use the net proceeds from the shares we offering primarily for general corporate purposes, including working capital, further expansion of our product development and field sales organizations, international expansion, general administrative matters and for capital expenditures, including infrastructure. In addition, we may use a portion of the proceeds from this offering for strategic acquisitions of, or investments in, complementary businesses, technologies or other assets.”
The underwriters are JPMorgan, Morgan Stanley, Goldman Sachs, Bank of America Merrill Lynch, and Allen & Company. LinkedIn is the world’s largest professional network with more than 225 million members. The company was founded in December 2002 and launched on May 5, 2003. It has users in more than 200 countries and territories.
Currently, the company’s revenue is $972 million annually and it has 4,000 employees worldwide. The site is available in 20 different languages. It has 65.6 million unique monthly visitors and 178.4 million visitors globally.
Stock value spiked 2.54 percent or $6.09 reaching $246.12 after the announcement was made. Trading continued after hours and stocks dropped 2.08 percent or $5.13 falling back to $241 per share. Founded in Santa Monica, Calif., the company’s current headquarters are in Mountain View, Calif. Reid Hoffman serves as chairman while Jeff Weiner is the CEO of the company, which uses the slogan “Relationships Matter.”
LinkedIn offers different programs, ranging from those who are free to professional programs that charge a monthly fee. Membership is constantly growing. The site is considered a social network for professionals so they can network with other professionals for jobs and business contacts. Based on the current value of the stock, the offering could actually exceed $1.1 billion in revenue for the company. Annual revenue for the company is expected to increase for the company in the next couple of years.
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