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Spotify Is Considering an IPO Without Raising More Money

by Lucas Shaw
April 7, 2017, 3:35 AM GMT+8

Spotify Ltd., owner of the popular music streaming service, is considering listing its shares on public exchanges without raising any new money, according to a person familiar with the company’s plans.

Spotify, which surpassed 50 million paying subscribers earlier this year, doesn’t feel the need to raise capital but wants to allow long-term investors and employees to cash out, said the person, who asked not to be identified discussing private information. A direct listing would address those needs by letting investors buy Spotify shares from current owners on the open market. That approach would be different from an initial public offering, the more traditional route hot tech startups use to go public and raise money at the same time.

Spotify, founded more than a decade ago by Daniel Ek and Martin Lorentzon, raised $1 billion in debt two years ago, the same year its revenue surpassed $2 billion. The company is eager to escape the burden of that debt, a convertible loan that will cost the company more money the longer it delays going public. It’s unclear whether a direct offering would satisfy the conditions of the loan.

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NYSE sets Spotify reference price at $132

Reuters Staff
April 3, 2018

(Reuters) - The New York Stock Exchange on Monday set the reference price for shares of music streaming service Spotify Technology SA at $132.

Spotify is pursuing an unusual direct listing to reach the public markets in place of an initial public offering, and shares are expected to start trading on Tuesday.

The reference price is not an offering price for the shares, nor is it the opening public price for shares of the Swedish technology company.

The opening public price will be determined by buy and sell orders collected by the NYSE from broker-dealers, the exchange said. Based on those orders, the opening price will be set based on a designated market maker’s determination of where buy orders can be matched with sell orders at a single price.

But the reference price will play a part in Spotify’s eventual pricing.

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