Darktrace would have revised down its valuation in anticipation of its upcoming IPO, scheduled for May 5 according to Bloomberg.
The cybersecurity company, which offers artificial intelligence-based threat detection and response solutions, will seek a valuation between £ 2.4 billion and £ 2.7 billion, according to Sky News.
The valuation, which would be much lower than previous hopes which valued the company at around 3.6 billion pounds, is expected to be announced on the London Stock Exchange on Monday.
Founded in 2013 and based in Cambridge, UK, Darktrace has already raised $ 230.5 million. The firm’s last round of financing took place in 2018.
Darktrace sees its IPO as a way to build long-term investment opportunities. The company is confident in the strength of the IPO for the London market.
According to people familiar with the matter, the latest valuation range for the cybersecurity firm has been changed due to the Deliveroo debacle when it debuted on the stock market.
The London-based delivery service went public on the London Stock Exchange on March 31. Shares fell more than 25% that day, one of the biggest recent tech flops in the stock market, resulting in huge losses for retail investors who opted in before the launch of the IPO in stock Exchange.
The post also cites Mike Lynch’s involvement as a reason for caution. Former Autonomy CEO and UK entrepreneur Mike Lynch is fighting an extradition request from the United States after being charged with fraud related to the sale of Autonomy to HP.
Lynch has denied any wrongdoing.
As the Financial Times reported, there appears to be a close relationship between Lynch’s Invoke Capital, a technology advisory and investment firm, and Darktrace – and there is concern that these ties may scare investors off. Mr. Lynch was previously a director of Darktrace and served on the company’s advisory board.
The post says Invoke was paid for support services, but the IPO will end that deal, with a £ 1.2million termination fee for Invoke.
Darktrace declined to comment.