Lyft's trading debut to be watched by IPO-hungry tech companies

Lyft's trading debut to be watched by IPO-hungry tech companies

"Lyft is shooting itself in the foot by going public, as I continue to think that the company is not ready for the harsh glare of the public market and it is giving away a big edge that it could have had over Uber", Windsor writes.

Lyft priced its IPO at $72 on Thursday night, putting its value at more than $24 billion. On Friday, the company announced that it will be investing $50 million a year, or 1% of profits, in Los Angeles through Lyft City Works, which supports "locally-driven transportation and other initiatives to improve people's lives in every city where we operate". General Motors Co is an investor in Lyft. Lyft intends to list its shares on the Nasdaq under the symbol LYFT.

With about 48 hours to go before the IPO, Lyft raised its expected share price to anywhere from $70 to $72 in an SEC filing.

Lyft marks the first big IPO in a while due to the volatile end to 2018 and the five-week partial government shutdown, which ended in January.

Lyft has been gaining ground on Uber in the past two years, which enabled it to double its revenue last year to $2.2 billion - the kind of growth that tends to wow investors.

In its S-1 filing earlier this month, Lyft said it controlled 39 percent of the US ridehailing market in 2018, up 17 percent since 2016.

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During that time, its losses also grew, from US$688 million in 2017 to US$911 million previous year.

Through Class B shares that carry 20 votes for each ordinary share, co-founders Logan Green, who is chief executive officer, and Vice Chairman and President John Zimmer will have about 49 per cent of the voting rights, according to the filing.

Welcome to this year's IPO season!

Due to its dual-class structure of shares-class A shares carry one vote each, class B shares carry 20 votes each-Lyft's cofounders Logan Green and John Zimmer will control nearly 49 percent of its voting shares despite owning only 5 percent of the company's outstanding stock. The company says its service is active in more than 300 markets in the USA and Canada. With Uber and Google's autonomous vehicle project, Waymo, ramping up the pressure, Wedbush noted that an "arms race" will create a number of uncertainties for Lyft.

Based on the total number of shares that were to be outstanding after the offering, its market value would be about US$20.6 billion.

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