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IPO Watch: Roku Is Red-Hot

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Roku Inc. has priced its initial public offering at the high end of its expected range, giving the maker of online video streaming players a valuation of $1.3 billion.

The IPO is priced at $14 per share, at the high end of the range of $12 to $14 per share set by Roku earlier this month.

Roku sold 15.67 million shares of its Class A common stock in the IPO, which includes share sales from both Roku and some of its private shareholders.

Roku said it is issuing and selling 9 million shares, while the selling stockholders are selling an additional 6.67 million shares. In addition, the underwriters have been granted a 30-day option to purchase up to an additional 2.35 million shares at the initial public offering price less underwriting discounts.

Roku's shares will debut on the Nasdaq Global Select Market on Thursday under the ticker symbol "ROKU".

Morgan Stanley & Co. LLC and Citigroup Global Markets Inc. are acting as lead bookrunners for the offering.

Los Gatos, California-based Roku was founded by Anthony Wood, inventor of the DVR. The company makes set-top boxes that allow users to stream Netflix, YouTube and other online video streaming services to their television.

Roku also offers its software to other consumers electronics makers that want to integrate its platform into their smart televisions.

As at the end of June 2017, Roku OS powered TV streaming for more than 15 million monthly active accounts, with users streaming nearly 7 billion hours of video and music in the first half of 2017.

Despite the growing popularity of online video streaming, Roku has largely remained unprofitable since its founding.

For the six months ended June 30, 2017, Roku reported net loss of $24.22 million on net revenue of $199.72 million. This compared to net loss of $33.24 million on net revenues of $162.26 million a year ago.

by RTT Staff Writer

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