The owner of the hugely popular app-based dating brand Tinder and other brands such as Match and OkCupid, is seeking a valuation of as much as $3.36bn in its initial public offering (IPO) in the US. The company was combined into a separate business specialising in dating sites by parent company InterActiveCorp.
The umbrella company IAC, led by billionaire chairman Barry Diller, was founded in 1995. Since then it has seen consistent growth especially with its flagship brand Tinder, known for its easy smartphone interface that lets users swipe right if they like a potential match or swipe left if they don't. A Goldman Sachs analysis projects that Tinder will alone add $138m to the company's top line next year.
The Dallas-based Match Group which announced its plans to go public in June this year will offer 33.3 million shares in a price range of $12 to $14. If the underwriters (JP Morgan Chase & Co, Allen & Co and Merrill Lynch) exercise their full option to purchase additional shares, the number would bump up to 38.3 million shares. The maximum that Match can fetch in this IPO will be $536.2m. The company has applied to be listed on the Nasdaq with the symbol "MTCH."
Debt owed to IAC to be paid off
Proceeds from the IPO will be used to pay off debt owed to IAC. There will be three classes of shares offered -- common stock, Class B and Class C. Holders of common stock will get one vote per share, while Class B shareholders will get 10 votes per share. The company announced that all of Class B shares will be exclusively held by IAC. Meanwhile, Holders of Class C stock will not get any vote, according to the SEC filing.
Including the shares offered to the underwriters, the company is going to offer a maximum 20% of the common stock while IAC will be exclusively holding Class B shares, which are entitled to 10 votes each. This means even after the sale IAC will retain control of the company with 98% of the voting rights.
Match Group's market penetration currently includes 190 countries and 38 languages across its 45 brands, with international revenue representing 35% of total sales in fiscal 2014. The online dating firm claims to have 59 million monthly active users as of 30 September of whom 4.7 million are paid users. It reported $888.3m in revenue in 2014, up about 11% from the previous year.
Of late, the company has seen its user base shift toward mobile users, increasing the importance of Tinder even more. As many as 68% of new registrations came from mobile devices in the first six months of this year, the company said in the documents.