Food delivery app Deliveroo has chosen London for its blockbuster initial public offering, which could see the company valued at £8bn.
Deliveroo said in a statement on Thursday that it would list shares on the London Stock Exchange if and when it decides to go public. The company is said to be working on plans for a public float, with an official announcement expected imminently.
"Deliveroo was born in London," founder and chief executive Will Shu said in a statement. “This is where I founded the company and delivered our first order. London is a great place to live, work, do business and eat.
“That’s why I’m so proud and excited about a potential listing here.”
UK chancellor Rishi Sunak said Deliveroo's decision to stay in London was "fantastic".
"Deliveroo has created thousands of jobs and is a true British tech success story," the chancellor said. “It is great news that the next stage of their growth will be on the public markets in the UK.”
Deliveroo was founded in 2013 as an app that lets people order takeaway food from restaurants. The company signs up restaurants and then allows gig economy drivers to pick up delivery jobs on its platform. In recent years the company has expanded into so-called "dark kitchens" and groceries as it has expanded and diversified its business.
Deliveroo has raised over $1.7bn (£1.2bn) in the private market from backers including Amazon (AMZN). Deliveroo was valued at $7bn in a recent funding round. The company had revenues of over £770m in 2019, the most recent year accounts are available, but made a loss of £317m as it invested in technology and expansion.
WATCH: Vegan Junk Food
"With its finances only recently bolstered by $180m of new funding from its stakeholders of Fidelity and Durable Capital Partners in January, the company could fetch a valuation of up to £8bn," said Michael Hewson, chief market analyst at CMC Markets.
"Deliveroo also has operations across 200 cities in Asia, as well as in Europe, and is likely to see plenty of interest given that the IPO of DoorDash in the US did fairly well."
Confirmation of Deliveroo's decision to pick London for its listing comes just a day after the chancellor announced plans to overhaul UK public market rules to make Britain a more attractive place for tech companies, life science businesses, and so-called 'blank cheque' companies.
"The UK is one of the best places in the world to start, grow and list a business – and we’re determined to build on this reputation now we’ve left the EU," Sunak said. "That’s why we are looking at reforms to encourage even more high growth, dynamic businesses to list in the UK."
Deliveroo said it would pursue a dual-class listing structure, one of the reforms recommended to the chancellor in a review published this week. Dual-class shares are commonplace in the US public markets and give founders more voting rights than shareholders who buy into a company during an IPO.