LinkedIn Corp., whose professional networking site has 90 million users, fleshed out its IPO plans, saying it would raise up to $175 million as it looks to lay a path to sustainable growth in a fiercely competitive social networking space.
The IPO will also be seen as a test of investor appetite for social networking websites ahead of a highly anticipated offering from Facebook, the social networking site that has more than 500 million users and has been valued at $50 billion.
LinkedIn, co-founded in 2002 by ex-PayPal executive Reid Hoffman, announced its intention to go public on Thursday, but has not yet decided how many shares will be offered or their price range.
Investor interest and valuations are surging for privately held Web companies like Facebook, Zynga and Groupon, which, media has reported, recently rejected a $6 billion takeover bid from Google
Earlier this week, Demand Media, which publishes articles online, saw its shares gain by more than a third on their debut in New York, signaling growing demand for media-related IPOs.
MEMBERSHIP, PROFITS JUMP
LinkedIn's net revenue nearly doubled to $161.4 million in the first nine months of 2010, with $1.85 million in profit, according to a filing with the U.S. Securities and Exchange Commission.
The company said the online professional network market was rapidly evolving, and it was competing with smaller international rivals such as Xing in Germany and Viadeo in France.
LinkedIn's registered membership increased almost two-thirds to 90 million last year, from 55 million users in 2009.
LinkedIn's IPO would consist of shares to be issued by the company, and the rest offered by certain stockholders. The company has not said on which exchange its shares will be listed.
It said it would use the IPO proceeds for working capital.
LinkedIn's investors include Greylock Partners, Bessemer Venture Partners, Goldman Sachs and Sequoia Capital, a venture capital firm that has backed Yahoo! Inc., Google Inc., Apple Inc., Cisco Systems Inc. and Oracle Corp.
Morgan Stanley, Bank of America and JPMorgan are among the bookrunners for the LinkedIn offering.
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