Warner Music raises nearly $2 billion at IPO

Len Blavatnik’s record company Warner Music raised nearly $2 billion at IPO, raising the bar of the most expensive IPO held this year, Forbes reports.

In total, the stock consisted of 77 million shares worth $25 per unit. The recording studio received $1.93 billion upon completion of the IPO.

According to market research firm MarketWatch, the placement became the largest on the American trading floors this year. Experts also clarified that Warner Music originally planned to place 70 million shares, with the price ranging from $23 to $26. However, on the first day of listing, the shares soared 16%.

The studio’s management placed an application in February, and in May the IPO was officially announced. The studio works with renowned musicians, among who are Ed Sheeran, Twenty One Pilots, Coldplay, Bruno Mars and others. Last year, the company’s revenue was $258 million.

The successful IPO is one of the positive signs of the recovery in the US IPO industry following the negative impact of the coronavirus. Among other things, the music industry is generally the most resilient to economic crises. Investors  also were not discouraged by the fact that the management immediately warned them about the delay in the release of new albums due to self-isolation. Since it wasn’t possible to hold the usual road show, where company representatives meet with investors, the presentation had to be moved to online.

The founder of the studio is Len Blavatnik, a native Ukrainian. The entrepreneur grew up in Russia, where he graduated from the Moscow Institute of Transport Engineers. In 1978, he left for America, where in 2011 he acquired Warner Music for $3.3 billion. Blavatnik ranks sixtieth in the list of the richest people in the world, and his fortune reaches $19.7 billion.