Spotify files confidential IPO documents with SEC - report

Music streaming service Spotify is coming closer to an IPO, after confidentially filing documents with the SEC at the end of December, Axios reported, citing multiple sources. The documents show Spotify wants a direct listing instead of a traditional float, a first for a tech company. With a direct listing, Spotify won’t hold a road show or other typical IPO events, although several investments banks are involved. The companies seems to still be in its quiet period. The idea was be for the company to list in the first quarter of the year. This timetable may however be hampered by news the company is being taken to court for copyright infringement, to the tune of USD 1.6 billion. 

Spotify was sued by Wixen Music Publishing last week for allegedly using songs without a license and compensation, Reuters reported. A source said the company still intends to proceed with its US direct listing in Q1, with the help of Goldman Sachs, Morgan Stanley, and Allen & Co. Market watchers say the lawsuit is unlikely to have a major impact on the company’s IPO. Spotify declined to comment on IPO matters. 

In November, company announced the acquisition of Stockholm-based online music studio startup Soundtrap. It revealed earlier that it had reached 60 million paid users in 60 markets, among a total of 140 million monthly active users. The worth at that time was at around USD 16 billion. Reuters noted that valuation hit USD 19 billion at some point last year.