Dropbox is planning to go public, with an initial public offering (IPO) that will test the value of the company on the open market.
That is according to Reuters, which claims that the company has hired underwriters to assist with its IPO.
The share offering will be launched before the end of the year, it adds, according to the usual ‘people familiar with the matter’. The IPO will be biggest technology company to go public this year since Snap, owner of Snapchat, in early March.
Dropbox was valued at almost $10bn in a private fundraising round in 2014, and the IPO will be a test of its real worth.
The company was established in 2007 as a free cloud storage and sharing service, but has since been overtaken in the market by the likes of Google Drive, Microsoft’s OneDrive and Box.
After initially focusing on consumers and students, in particular, Dropbox is now focused on winning enterprise clients for its Dropbox Business service, which charges a licence fee based on the number of employees using it.
Drew Houston has said that he expects the company to generate more than $1bn in revenues this year.
Sources have said that Dropbox will begin to interview investment banks ‘in the coming weeks,’ although the company itself had no comment on the rumours.
However, 2017 hasn’t been a big year for technology IPOs, with the value falling sharply and Snap having a rocky start to life as a public company.
Dropbox’s closest competitor, Box, was valued at around $1.7bn during its 2015 IPO: less than the $2.4bn it had been assigned in private fundraising rounds. Box lost 40 per cent of its value over the course of the year.
The news comes after it was reported that Dropbox secured a $600m credit line from six banks in late March, a move that was also linked to IPO plans.
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