Instacart raises price range for IPO after Arm’s strong debut

Sept 15 (Reuters) – Grocery delivery app Instacart raised the proposed price range for its initial public offering (IPO) on Friday, revising its terms to target a fully diluted valuation of up to $10 billion after Arm Holdings’ impressive debut.

The high prices indicate strong investor demand for the San Francisco-based company, which is looking to list its shares this month after years of waiting.

September is shaping up to be one of the busiest periods for new listings.

Shares of SoftBank’s chip designer Arm (9984.T) rose nearly 3% in choppy early trading Friday, extending gains from a strong close on the first day of trading.

Another portfolio company of the Japanese investment giant, Nomura Therapeutics, is set to begin trading, while marketing firm Clavio is eyeing a listing in the next few weeks.

Traditional IPOs in the United States have raised more than $5 billion so far in September, according to data from Dealogic, already the second-biggest month for such stock offerings this year.

Instacart said 22 million shares will be sold at $28 to $30 per share, compared to the previous price range of $26 to $28 per share. At the high end, the IPO will bring in $660 million compared to the previous target of $616 million.

Of the total proceeds, up to $237 million could go to existing Instacart investors looking to sell their shares.

However, the company’s high valuation target would still be just a quarter of the $39 billion it was worth after its last funding round more than two years ago.

Cornerstone investors have indicated they would buy up to $400 million worth of shares, which would represent about two-thirds of the total proceeds if priced at the high end of the range.

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