Despegar Finally Prices IPO

By Chris Lange Updated Jan 12, 8:20AM EST · Published Sep 11, 10:30AM EDT

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Despegar Finally Prices IPO — © Thinkstock

Despegar.com has registered an amended F-1 form with the U.S. Securities and Exchange Commission (SEC) in regards with its initial public offering (IPO). The company intends to price its 12.77 million shares in the range of $23 to $26 per share, with an overallotment option for an additional 1.92 million shares. At the maximum price, the entire offering is valued up to $381.82 million. The company intends to list its shares on the New York Stock Exchange under the symbol DESP.

The underwriters for the offering are Morgan Stanley, Citigroup, Itau BBA, UBS Investment Bank, Cowen and KeyBanc Capital Markets.

This is the leading online travel company in Latin America, known by its two brands, Despegar, the global brand, and Decolar, the Brazilian brand. The company has a comprehensive product offering, including airline tickets, packages, hotels and other travel-related products, which enables consumers to find, compare, plan and purchase travel products easily through its marketplace.

Despegar provides its network of travel suppliers a technology platform for managing the distribution of their products and access to users. The firm believes that its focus on the underpenetrated Latin American online travel market will allow it to continue industry leadership.

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In the six months ended June 30, 2017, and the year ended December 31, 2016, Despegar had roughly 2.5 million and 4.0 million customers, generating $248.5 million and $411.2 million in revenue, respectively. Its gross bookings were $2.1 billion and $3.3 billion in the six months ended June 30, 2017, and the year ended December 31, 2016, respectively.

In the filing, Despegar detailed:

Total Latin America online travel bookings are projected to be approximately $29.7 billion in 2016 and are expected to grow to approximately $47.6 billion by 2020, representing an estimated compound annual growth rate (CAGR) of 12.5%, according to Euromonitor International, with projected penetration of online travel bookings expected to increase from approximately 31% in 2016 to approximately 36% in 2020.

The firm intends to use the net proceeds it receives from this offering for general corporate purposes, including potential acquisitions or other strategic opportunities in the future.

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About the Author Chris Lange →

Chris Lange is a writer for 24/7 Wall St., based in Houston. He has covered financial markets over the past decade with an emphasis on healthcare, tech, and IPOs. During this time, he has published thousands of articles with insightful analysis across these complex fields. Currently, Lange's focus is on military and geopolitical topics.

Lange's work has been quoted or mentioned in Forbes, The New York Times, Business Insider, USA Today, MSN, Yahoo, The Verge, Vice, The Intelligencer, Quartz, Nasdaq, The Motley Fool, Fox Business, International Business Times, The Street, Seeking Alpha, Barron’s, Benzinga, and many other major publications.

A graduate of Southwestern University in Georgetown, Texas, Lange majored in business with a particular focus on investments. He has previous experience in the banking industry and startups.