Twitter files for an initial public offering
Social media giant tweets it has submitted "confidential" filing to securities regulators.
Twitter disclosed on Twitter Thursday afternoon that it's in the process of filing for an initial public offering.
On its official Twitter page, Twitter wrote, "We've confidentially submitted an S-1 to the SEC for a planned IPO. This Tweet does not constitute an offer of any securities for sale."
The message comes straight out of the boilerplate language used on a typical regulatory filing when a company intends to sell publicly traded shares to investors.
So far, the company had not filed an official registration statement with the Securities and Exchange Commission that's available for the public to read, which is the first step in moving toward an IPO. By submitting the S-1 to the SEC in private, that gives regulators a chance to look it over and point out any issues before Twitter makes it available to the public, says Francis Gaskins of IPO Desktop.com. No price range for the stock has been set.
Given the status of the filing at this point, Gaskins expected the deal to hit the stock market by early December. The fact that number one social networking firm Facebook shares recently closed at an all-time record after many months of a subpar stock price may help fan demand for the stock.
Twitter's IPO comes just as demand for IPOs is starting to heat up. So far this year, 131 companies have filed for IPOs, which is up 44% from the 91 that filed at this point last year, says Renaissance Capital. Technology, so far, has not been the top driver of the activity. So far this year, 22 of the IPOs have been technology companies, trailing the 31 from the financial sector and 33 from the health care sector.
But investors are starting to clamor for new shares. Shares of IPOs this year have jumped 13% on their first day of trading, up dramatically from the 3% pop in 2008, says Renaissance. The first day pop of technology stocks, though, have been even better at 23%.