eToro launches roadshow for IPO targeting $4b valuation

eToro announced that it has launched the roadshow for its initial public offering (IPO) of 10,000,000 Class A common shares - 5,000,000 offered by eToro and another 5,000,000 by certain existing stockholders - aiming for a valuation of between $3.7b and $4.1b.

As it said, eToro expects to grant the underwriters a 30-day option to purchase an additional 1,500,000 common shares to cover over-allotments, if any. The IPO is expected to price between $46.00 and $50.00 per share. eToro has applied to list its Class A common shares on the Nasdaq Global Select Market under the ticker symbol "ETOR".

Asset manager BlackRock is an anchor investor in the offering and according to reports, is expected to buy shares for $100m.

Goldman Sachs & Co. LLC, Jefferies, UBS Investment Bank and Citigroup are acting as lead book-running managers for the proposed offering.

Deutsche Bank Securities, BofA Securities, Cantor, Citizens Capital Markets, Keefe, Bruyette & Woods, A Stifel Company, Mizuho, and TD Securities are acting as additional book-running managers.

Canaccord Genuity, Moelis & Company, Needham & Company, Rothschild & Co and Susquehanna Financial Group LLLP are acting as co-managers.

eToro CEO Yoni Assia

As for existing shareholders, according to a Finance Magnates analysis, eToro CEO Yoni Assia stands to make up to $27.5m by selling part of his stake in the public offering, while his brother, Ronen Assia, intends to make up to $12.75m.

Other large shareholders—including Spark Capital, BRM Group (the Barkat family office), Andalusian, and CM Equities—are also expected to cash out tens of millions of dollars each.

“The principal purposes of this offering are to increase our capitalisation and financial flexibility and to create a public market,” eToro said in its announcement. “We intend to use the net proceeds from this offering for general corporate purposes, including working capital, operating expenses and capital expenditures.”