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Timon And Pumba Find GrubHub In The Dirt As IPO Stumbles

Timon And Pumba Find GrubHub In The Dirt As IPO Stumbles
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Highly-anticipated GrubHub (NYSE: GRUB) IPO eats dirt as it begins trading for the first time today.

The IPO increased its 7.0 million share offering last night to 7.4 million and priced at $26.00 per share, just above the expected range of $23.00 to $25.00 through underwriters Citigroup and Morgan Stanley.

Priced at $26.00, the stock opened well above for $40.00 per share. Within the first minute, it hit an intraday high of $40.80, before crashing to a low of $35.30. In the first minute of trading, over 1.4 million shares traded hands, leaving some investors particularly disappointed as the stock slipped over five percent within minutes of opening.

Related: One Goes Up, Another Finds The Floor: Thursday Morning's IPOs

GrubHub is a technology company that maintains an online guide for various restaurants and diners, allowing consumers to place orders directly through the website, a phone call or the company's smartphone apps.

According to GrubHub's S-1 filing with the SEC, they intend to use the proceeds for, “working capital and other general corporate purposes.” They also are able to, “invest in other complementary businesses, products, services, technologies, or other assets.” As the company decides what to do with the near $200 million dollars raised, they will, “invest the net proceeds that we receive in this offering in short-term and intermediate-term interest-bearing obligations, investment-grade investments, certificates of deposit or direct guaranteed obligations of the U.S. government.”

Disclosure: At the time of this writing, the author holds no positions in the aforementioned securities; however, he may have previously held one, or may hold one in the future.

Posted-In: Citigroup Morgan StanleyNews IPOs Intraday Update Best of Benzinga


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