"AI unicorn" AsteraIPO with a scale of up to USD 7.13 billion will debut on Nasdaq tonight

According to the Zhītōng Finance and Economics APP, semiconductor startup Astera Labs (ALAB.US) and its investors raised $713 million in their initial public offering (IPO), with the stock price higher than the revised market pricing range.

In a statement, it was mentioned that leveraging the demand for AI-related investments, Astera and existing shareholders sold 19.8 million shares at a price of $36 per share on Tuesday. Astera's investors include Intel (INTC.US) and Sutter Hill Ventures. After increasing the size of the stock offering and the target price, the company priced its shares at $32 to $34.

Based on the outstanding shares listed in the documents submitted to the U.S. Securities and Exchange Commission, Astera's market value is approximately $5.5 billion at the IPO price. Including stock options and restricted stock, its fully diluted value is close to $6 billion.

This IPO is one of the largest IPOs so far this year. The day before, social media company Reddit Inc. made a high-profile stock sale, seeking to raise up to $748 million for the company, its employees, and shareholders.

IPO Size Exceeds Maplebear and Klaviyo

In the recent large-scale IPOs of U.S. tech companies, Astera's listing size exceeds the $660 million financing of Maplebear (CART.US) in September last year and Klaviyo (KYVO.US) with $659 million financing. Although these IPOs, as well as the $5.23 billion IPO of UK chip design company Arm (ARM.US) (the largest IPO in 2023), did not trigger a listing frenzy, the market has since warmed up. Compiled data shows that before Astera sold its shares, over $7.2 billion had been raised through IPOs on U.S. exchanges this year.

This IPO is led by Morgan Stanley and J.P. Morgan, with Barclays, Deutsche Bank, Evercore, Jefferies, and six other companies serving as joint bookrunners. Astera's stock is expected to start trading on the Nasdaq Global Select Market on Wednesday under the symbol ALAB.

According to its website, Astera was founded in 2017, developing semiconductor-based connectivity solutions aimed at mainstreaming AI and machine learning in the cloud. In a funding round led by Fidelity Management & Research in 2022, Astera raised $150 million, valuing the company at $3.15 billion, capitalizing on investors' optimism towards AI.

Nvidia (NVDA.US) and other AI-related stocks have surged in the past year, driving U.S. stock indices to record highs Narrowing Losses

According to the documents submitted by Astera, in 2023, the company will reduce its net loss to $26 million, with revenue of $116 million, compared to a loss of $58 million and revenue of $80 million in the previous year.

The company's investors include Intel's venture capital division. Its largest shareholder is Sutter Hill Ventures, which will control 12.6% of the company's shares after going public. The documents show that Fidelity's funds will hold 6.4% of the shares.

Astera's co-founder and CEO, Jitendra Mohan, will hold 6.1% of the company's shares, while co-founder and COO Sanjay Gajendra will hold 5% of the shares.

In this IPO, approximately 3 million shares will be sold by current shareholders. Upward Bound Youth Group will sell 2 million of them, with the rest being sold by C&F Investments and investors holding less than 1% of the shares