Deliveroo to be valued at £7.6bn on its stock market debut following investor backlash over staff working conditions
Deliveroo will make its long-awaited stock market debut today, valued at £7.6billion.
The final figure, equivalent to 390p per share, is at the bottom end of the food delivery firm’s previous pricing range following an investor backlash over staff working conditions.
But it will still be London’s biggest listing for a decade, raising around £1billion for expansion efforts. Chancellor Rishi Sunak, hailed Deliveroo’s decision to go public in London as a ‘true British tech success story’.
Strong demand for Deliveroo’s float has been overshadowed in recent days by criticism from heavyweight investors over the status of tens of thousands of the firm’s delivery riders
However, strong demand for the float has been overshadowed by criticism over the status of tens of thousands of Deliveroo delivery riders.
As big funds including Aberdeen Standard Life, Aviva and M&G said they were sitting out the listing, the firm abandoned its price target of 460p for a more conservative 390p.
It means its valuation fell from an upper projection of £8.8billion to £7.6billion, with founder Will Shu’s payout for selling shares down from £30.8million to £26.2million.
His remaining stake afterwards will be worth £449million.
At the centre of concerns is the status of Deliveroo’s riders as ‘self-employed’, meaning they are not entitled to the minimum wage, holiday pay or sick leave.
There are fears that it could face an employment rights crackdown akin to Uber, which was forced to overhaul how it pays taxi drivers.