Instacart, one of the largest online grocery delivery platforms in the U.S., is gearing up for a significant initial public offering (IPO) to raise fresh capital and provide liquidity to existing shareholders. In an updated filing submitted on Monday, Instacart revealed its intention to raise up to $616 million in capital at a valuation of as much as $9.3 billion.
The company plans to set an offer price for its IPO shares between $26 and $28. This offering includes the issuance of 22 million shares in total, comprising 14.1 million newly issued shares from Instacart and 7.9 million shares from existing selling stockholders. At the higher end of this pricing range, Instacart anticipates generating approximately $616 million in proceeds.
On a fully diluted basis, Instacart’s share count will reach 331 million, encompassing restricted stock units, stock options, and warrants.
Notably, multinational food giant PepsiCo is set to become an investor in Instacart through a concurrent private placement, acquiring $175 million worth of shares. Goldman Sachs, one of the IPO’s underwriters, will facilitate this private placement.
Instacart has also received interest from Norges Bank Investment Management, Norway’s sovereign wealth fund, to become a cornerstone investor in the IPO. Alongside other major investors like TCV, Sequoia Capital, D1 Capital Partners, and Valiant Capital Management, the fund could potentially purchase around $400 million worth of shares.
However, Instacart noted that the actual allocation of shares to cornerstone investors remains subject to underwriter decisions and investor choices.
Instacart operates in the highly competitive online grocery delivery sector, facing off against traditional retailers and tech giants like Amazon, DoorDash, GoPuff, and Grubhub. Its IPO is expected to be one of the largest public flotations of the year.
This move by Instacart is part of a broader trend of companies going public as market conditions improve, following a slowdown in IPOs due to concerns related to rising interest rates and inflation. The success of these IPOs will be closely watched and dependent on market conditions when the companies officially go public.