Video Conferencing major Zoom on January 12 said it plans to raise $1.5 billion in a secondary share sale.
The company plans to sell 4.4 million new shares at $337.71 a piece, valuing the stock more than 10 times its debut price of $36 less than two years ago.
The company came into the limelight in 2020 when most companies were forced into remote working following the onset of COVID-19. Since becoming a household name last year, the stock has quintupled in value.
Moreover, the video chat company boasts of a strong balance sheet with $730.5 million in cash and equivalents as on October 2020, compared to $283.1 million in January. This coupled with the proposed fundraising puts Zoom in a prime position to make significant acquisitions in the years to come.
Zoom said it plans to use the money for operating expenses and capital expenditures, and "may also use a portion of the net proceeds for acquisitions or strategic investments in complementary businesses, products, services or technologies."
Even though Zoom stock has surged 10 times since its IPO, it is significantly off its lifetime high. The scrip has fallen about 41 percent since hitting its peak of $568.34 in mid-October. The significant drop came on the back of earlier than expected rollout of vaccines in multiple countries.
On January 12, shares of Zoom shares closed 5.7 percent higher at $356.81.