Online gaming company Zynga could raise as much as $1 billion at its much-anticipated initial public offering, per the company’s filing with the Securities and Exchange Commission Friday morning.
In the SEC documents, Zynga set the price range for its IPO at $8.50 to $10, and because the company is selling 100 million shares – 14.3 percent of its total – that means it could net anywhere from $850 million to $1 billion. If demand is strong enough, it could sell an additional 15 million shares.
Zynga is the creator of popular online games, such as Farmville and CityVille, and generates large revenues from advertising as well.
The company initially filed for an IPO back in July, and at the time it was rumored that the company would be looking for about $1 billion.
However, the financial downturn led Zynga and similar burgeoning companies to delay their IPOs. The IPO market remains softer than it was with companies like Groupon and Linkedin losing value after they went public.
Zynga’s valuation has dropped some as a result, but with analysts predicting a total around $7 billion, no one is shedding too many tears for CEO Mark Pincus.
What makes Zynga so attractive to some is that the company is already profitable, reporting net income of $12.5 million in the third quarter and earnings of $30.7 million for the first nine months of the year.
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The company’s two largest investors – Pincus and venture capital firm Kleiner Perkins Caufield & Byers – are holding on to all their shares while some other venture capital investors are selling percentages of theirs.
The price of the shares may still change as the IPO will not take place until mid-December.