LinkedIn eyes up to USD 1.35 bn from share sale

Business networking site LinkedIn expects its share sale of about 6.19 million shares to garner up to USD 1.35 billion, which would be utilised for global expansion and meeting working capital requirements.

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The California-based firm, which claims to be the world's largest professional network, has over 238 million members in more than 200 countries and territories, of which Asia Pacific, including India, accounts for around 42 million members.

The share sale, which commenced yesterday, will close on September 10, 2013 and the company has fixed a price of USD 223 per share of Class A common stock. "On September 4, 2013, LinkedIn entered into an underwriting agreement... the several underwriters to issue and sell 5,381,166 shares of Class A common stock of the Company," it said in a filing with the US Securities and Exchange Commission (SEC).

The filing further said: "In addition, the company granted the Underwriters an option to purchase, for a period of 30 days from September 4, 2013, up to an additional 807,174 shares of Common Stock.

"The company estimates that the net proceeds from the offering will be approximately USD 1.17 billion, or approximately USD 1.35 billion if the Underwriters exercise in full, their option to purchase additional shares of Common Stock, after deducting underwriting discounts and estimated offering expenses."

The principal purposes of the offering are to increase LinkedIn's financial flexibility and to further strengthen its balance sheet, it said. "LinkedIn intends to use the net proceeds of the offering primarily for general corporate purposes, including working capital, expansion of product development and field sales organisations, international expansion, general administrative matters and for capital expenditures, including infrastructure.

"We may use a portion of the proceeds from this offering for strategic acquisitions of, or investments in, complementary businesses, technologies or other assets," the firm added. After the offering, the total Class A common stock that will be outstanding with LinkedIn will be 98,948,071. The lead book running managers of the offering are JP Morgan Securities and Morgan Stanley, it said, adding Goldman Sachs and BofA Merrill Lynch are acting as joint book running managers, while Allen & Company is acting as co-manager.

In May 2011, LinkedIn's initial public offering (IPO) saw sale of 6,003,804 shares of its Class A common stock and some of its stockholders sold a total of 3,012,196 shares of the Class A common stock. It received USD 248.4 million, net of underwriting discounts and commissions and other costs associated with the offering.