Airbnb plans to hire Morgan Stanley, Goldman Sachs as lead advisers on planned stock market flotation: media reports

Airbnb Inc, the company that lets users rent out their own rooms and homes to travelers, plans to hire Wall Street heavyweights Morgan Stanley (NYSE:MS) and Goldman Sachs Group Inc (NYSE:GS) as joint lead advisers on its planned stock market flotation next year, according to media report. 

However, the plans to involve the investment banks are still subject to change, the Reuters news service reported. 

Airbnb is leaning toward going public through a less lucrative direct listing, rather than an initial public offering (IPO) that would earn more money for the investment banks, Reuters noted.  

READ: Airbnb to go public in 2020

In an IPO, the company or its investors sell shares in a process managed by the banks as underwriters. But in a direct listing no new shares are sold, and the role of the investment banks is more of one advising on market conditions, as opposed to underwriting.

As a result, companies can save on the investment-banking fees they pay through a direct listing.

Airbnb, founded by a pair of roommates in 2008, revealed in a single sentence on September 19 that it plans to go public in 2020. The company has hinted at an IPO since 2015.

The most recent public valuation estimated its worth at $38 billion, according to a report from Vox Media’s Recode

Reuters reported that shares are trading in the private market at a price that values Airbnb at around $46 billion, citing sources who cautioned that such thin trading volumes can inflate the price.

The group recently reported second-quarter number showing that revenue topped $1 billion.

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Story by ProactiveInvestors