SoftBank-backed Compass valued at $8.22 billion in NYSE debut

Shares of SoftBank-backed Compass jumped 18% in their stock market debut on Thursday, giving the real estate brokerage firm a market value of $8.22 billion, after being priced at the lower end of the reduced IPO price range.

Stock opened at $21.25, above the IPO price of $18 per share.

The company, which downsized its IPO and reduced its price target range, sold 25 million shares on Wednesday, raising about $450 million. It was earlier looking to raise about $936 million by selling 36 million shares at the upper end of its initial price range of $23 to $26 per share.

Compass debuts at a time of historic boom in U.S. capital markets, with companies raising $167 billion in 2020, according to data from Dealogic, a record that investment bankers expect will be surpassed this year.

Founded in 2012 by former Twitter Inc engineer Ori Allon and former Goldman Sachs executive Robert Reffkin, New York City-based Compass runs an integrated software platform that serves real estate agents in the residential market.

It recorded about $152 million in transactions in residential real estate last year, a recent regulatory filing showed, which represents nearly 4% of the U.S. market.

Compass saw a surge in online home transactions during the COVID-19 pandemic, with revenue jumping 56% to $3.7 billion in 2020.

The company had raised $1.5 billion from investors, including Goldman Sachs and Canada Pension Plan Investment Board, before its IPO. It was valued at $6.4 billion after a $370 million funding round in 2019.

Goldman Sachs, Morgan Stanley and Barclays were the lead underwriters for the offering.

Source: Reuters