(Reuters) – Airbnb Inc’s new $1 billion investment from private equity firms Silver Lake and Sixth Street Partners has terms that imply a reduced valuation of the home rental company, people familiar with the matter said on Tuesday.
FILE PHOTO: The Airbnb logo is seen on a little mini pyramid under the glass Pyramid of the Louvre museum in Paris, France, March 12, 2019. .REUTERS/Charles Platiau/File Photo
Silver Lake and Sixth Street received warrants that can be exercised at an $18 billion valuation, below the $26 billion Airbnb was valued in early March in its internal valuation, one source said.
The deal was seen as a sign of investor support as the coronavirus grinds global travel to a near-standstill, and the sources said Airbnb will terminate a $1 billion credit facility following the investment, the sources said.
The deal is comprised of $1 billion in five-year debt yielding 11% to 12% and warrants that can convert into stock equating to a little over 1% of Airbnb’s total equity, the sources said. They requested anonymity as the terms are confidential.
The deal raised Airbnb’s cash reserves to around $4 billion. [nL4N2BU3PH]
In March, Reuters reported the U.S. short-term home rental platform held a phone meeting with lenders to discuss extending an existing $1 billion debt facility, which was led by Bank of America (BAC.N), amid a slowdown in demand due to the coronavirus pandemic.
Airbnb is now also in talks with banks about a new line of credit that could be worth as much as $750 million or $1 billion, one source said.
Airbnb was valued at $31 billion in its most recent private fund-raising round.
Silver Lake is targeting a valuation for Airbnb of $40 billion to $50 billion to hit its return target, one of the sources said, declining to provide more details.
Airbnb, Silver Lake, Sixth Street and Bank of America declined to comment.
Reporting by Joshua Franklin in New York; Editing by Tom Brown and Rosalba O’Brien
TORONTO – Canada’s main stock index was up more than 100 points in late-morning trading, helped by strength in base metal and utility stocks, while U.S. stock markets were mixed.
The S&P/TSX composite index was up 103.40 points at 24,542.48.
In New York, the Dow Jones industrial average was up 192.31 points at 42,932.73. The S&P 500 index was up 7.14 points at 5,822.40, while the Nasdaq composite was down 9.03 points at 18,306.56.
The Canadian dollar traded for 72.61 cents US compared with 72.44 cents US on Tuesday.
The November crude oil contract was down 71 cents at US$69.87 per barrel and the November natural gas contract was down eight cents at US$2.42 per mmBTU.
The December gold contract was up US$7.20 at US$2,686.10 an ounce and the December copper contract was up a penny at US$4.35 a pound.
This report by The Canadian Press was first published Oct. 16, 2024.
TORONTO – Canada’s main stock index was up more than 200 points in late-morning trading, while U.S. stock markets were also headed higher.
The S&P/TSX composite index was up 205.86 points at 24,508.12.
In New York, the Dow Jones industrial average was up 336.62 points at 42,790.74. The S&P 500 index was up 34.19 points at 5,814.24, while the Nasdaq composite was up 60.27 points at 18.342.32.
The Canadian dollar traded for 72.61 cents US compared with 72.71 cents US on Thursday.
The November crude oil contract was down 15 cents at US$75.70 per barrel and the November natural gas contract was down two cents at US$2.65 per mmBTU.
The December gold contract was down US$29.60 at US$2,668.90 an ounce and the December copper contract was up four cents at US$4.47 a pound.
This report by The Canadian Press was first published Oct. 11, 2024.
TORONTO – Canada’s main stock index was little changed in late-morning trading as the financial sector fell, but energy and base metal stocks moved higher.
The S&P/TSX composite index was up 0.05 of a point at 24,224.95.
In New York, the Dow Jones industrial average was down 94.31 points at 42,417.69. The S&P 500 index was down 10.91 points at 5,781.13, while the Nasdaq composite was down 29.59 points at 18,262.03.
The Canadian dollar traded for 72.71 cents US compared with 73.05 cents US on Wednesday.
The November crude oil contract was up US$1.69 at US$74.93 per barrel and the November natural gas contract was up a penny at US$2.67 per mmBTU.
The December gold contract was up US$14.70 at US$2,640.70 an ounce and the December copper contract was up two cents at US$4.42 a pound.
This report by The Canadian Press was first published Oct. 10, 2024.
