Twitter, the social networking business that has helped connect celebrities, corporations, government officials, and everyday citizens, announced its intention to go public according to a report published by Reuters on Friday, September 13, 2013.
Twitter took the first step toward its IPO by filing with US regulators on Thursday, September 12, 2013. The company has been in business since 2006 and has felt pressure in the past to go public, but its management resisted, deeming it unnecessary. Last year’s IPO debacle by Facebook was also good reason to remain cautious. But with the rebound in Facebook’s share price and the common stock prices of other dotcoms, the time for an IPO seems right.
Max Woolf of Greencrest Capital feels Twitter’s public appearance is long overdue.
"It's completely conquered mobile. It has an enormous social network. It's becoming a key utility as a second screen to TV and it's literally the first draft of history," said Woolf. "Normally a company like Twitter would have been public for some time."
Estimates value Twitter at around $10 billion. Analysts predict the company is poised for rapid revenue growth and that an IPO will infuse the business with enough cash to accelerate its growth at an even faster pace.
No official announcement has been made as to the underwriter of this IPO, but sources indicate that Goldman Sachs will likely take the task. Morgan Stanley, JP Morgan, and several other major financial institutions have expressed an interest in handling the IPO, but Goldman Sachs is the current front- runner.
A successful IPO can do much to help launch a business. If not handled properly, however, it can lead to all sorts of problems, as the management of Facebook is painfully aware. Twitter’s IPO will not reach the size of Facebook’s, but Twitter has learned from Facebook’s mistakes and is determined to make its pending IPO a success.
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