Snowflake, a provider of cloud-based data storage and analysis software, priced its IPO above its increased range in an offering that values the company at $33.3 billion.

Snowflake
is selling 28 million shares at $120 a piece, according to a person
familiar with the matter who asked not to be named because the pricing
hasn’t been made public. The company, which is poised to debut on the
New York Stock Exchange on Wednesday under the ticker symbol “SNOW,” is
the first of several technology companies to go public this week in one
of the busiest stretches of the year. Snowflake will raise approximately $3.4 billion from the offering.

Investors
are bidding up Snowflake’s ahead of the offering as they anticipate a
blockbuster opening for a company that’s generating over $500 million in
annualized revenue and grew over 130% in the first half of the year. The company had already raised
its anticipated debut price range from a maximum of $85 to a max of
$110 in the space of less than a week. Snowflake is growing alongside
the major public cloud vendors by providing technology that allows
clients to quickly analyze and share vast amounts of data and increase
capacity as needed, rather than relying on databases that are tied to
hardware.

Last week, Snowflake revealed in a filing that Berkshire Hathaway and Salesforce
each agreed to buy $250 million of stock at the IPO price in a
concurrent private placement. Berkshire Hathaway also agreed to buy 4.04
million shares in a secondary transaction from former CEO Bob Muglia.
Based on the IPO price, Berkshire will be paying $484.8 million for
those shares.

Snowflake is entering a market that’s hungry for
high-growth cloud software makers, particularly those that have shown an
ability to continue expanding through the coronavirus pandemic. Even
after pulling back this month, the BVP Nasdaq Emerging Cloud Index,
consisting of over 50 publicly traded companies, is up about 55% this
year, compared to a 25% gain for the Nasdaq and 5.3% advance in the
S&P 500.

 

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