Mobile gaming firm AppLovin hires Morgan Stanley to lead its IPO

Applovin

AppLovin Corp, the US-based mobile gaming company backed by private equity firm KKR & Co, has hired Morgan Stanley to lead preparations for an initial public offering which could come early in 2021, according to individuals familiar with the issue.

The business has flirted with the concept of an IPO for years, but had never obtained a definite preparatory step. It’s the most recent mobile gaming start-up to eye a stock exchange listing, as requirement for video games surges among customers staying at home throughout the ongoing coronavirus pandemic.

The resources requested anonymity since the IPO trainings are confidential and cautioned that the plans are subject to market conditions.

“Today gaming is a fractured, fragmented market. I think the market will consolidate, and I think AppLovin will be one of those consolidators,” Ted Oberwager, a managing director in KKR’s tech, telecommunications and media staff and an AppLovin board member, stated in a meeting.

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AppLovin and Morgan Stanley declined to comment.

AppLovin was profitable since it was founded in 2012 as a cellular games advertising platform. It expects to make about $1.5 billion in revenue for 2020, based on one of the resources, who’s knowledgeable about the organization’s finances.

By comparison, gaming system Unity Software went public at a rate of $13.7 billion after reporting earnings for the first six months of 2020 of $351 million. Its shares have climbed more than 60 percent since the IPO.

In 2018, KKR acquired a minority stake in AppLovin for $400 million, valuing the company at $2 billion. AppLovin now expects to control a higher appraisal, the sources stated.

In 2018, AppLovin also started a media division, Lion Studios, to work with developers to advertise and publish apps.

It has expanded further into gambling by means of a string of acquisitions and investments, such as Machine Zone, Belarusian sport studio Belka Games, PeopleFun and Firecraft Studios.

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In the last 12 months, AppLovin has also hired Herald Chen as CFO. He joined from KKR, where he was head of technology, media and telecom in the Americas and led the company’s investment in AppLovin.

US consumer spending on video gambling hit a record $11.6 billion in the second quarter, up 30% on the year-ago span, according to research vendor NPD Group.

Gambling giant Roblox Corporation is also working with investment banks to get ready for a US stock exchange record that will come early next year and the online gaming platform anticipates could double its recent $4 billion evaluation, Reuters reported last week.

The team at Platform Executive hope you have enjoyed this news article. Initial reporting via our official content partners at Thomson Reuters. Reporting by Joshua Franklin in New York. Editing by Matthew Lewis.

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