Online vacation rental company Airbnb Inc, is planning to confidentially file paperwork for an initial public offering (IPO) with the US Securities and Exchange Commission by August end. The company faced cancellation of 90% of its bookings because of the pandemic and had to let go of 25% of its workforce.
The stock market listing will enable the trading of the company’s shares by the fourth quarter. Airbnb was close to hiring Morgan Stanley and Goldman Sachs Group Inc. as joint lead advisors on its planned stock market floatation according to a Reuters report in October. The decision to go public could help the company recover the huge losses it incurred in pandemic imposed travel ban and lockdowns.
Airbnb’s CEO Brian Chesky had initially planned to go for a listing in March but the mass cancellation of bookings amounting to 1 billion USD forced the company to fire a quarter of its employees. It had to raise $2 billion in debt and its value fell from $31 billion to $18 billion.
By May Airbnb saw a travel rebound and a 20% increase in bookings over the year in the US and decided to go for the traditional IPO route to stay afloat.