IAC’s Match Group Gains After Raising $400 Million in IPO

Updated on
  • Chairman Blatt says company recognizes `choppy market'
  • Proceeds will go toward repaying debt owed to parent

Match Group Inc., the owner of online-dating services Tinder, Match and OkCupid, closed more than 20 percent above its initial public offering on its first day of trading, after pricing shares at the low end of the marketed range.

The unit of billionaire Barry Diller’s IAC/InterActiveCorp raised almost $400 million in its IPO. Match sold 33.3 million shares for $12 each, according to a statement Wednesday, after offering them for $12 to $14. Based on the IPO price, the company had a market value of about $2.9 billion. The shares, equivalent to about a 14 percent stake in the company, are listed on the Nasdaq Stock Market under the symbol MTCH.

Match rose 23 percent to $14.74 at the close in New York, putting its market value at $3.5 billion.

Match’s IPO will give public investors a way to bet on the online-dating behemoth, instead of indirectly holding shares of parent company IAC. It’s been a relatively slow time for U.S.-listed technology and Internet offerings: 26 companies raised $7.1 billion this year through Tuesday, compared with 47 IPOs for 2014 that raised $34.3 billion.

‘Choppy Market’

“We recognize it’s a choppy market,” Greg Blatt, Match’s chairman, said in an interview on Bloomberg TV. “We wouldn’t have priced it where we priced it if we expected it to trade down.”

Match said in a separate filing Wednesday that an interview with Sean Rad, the chief executive officer of its Tinder app, published that day in the U.K.’s Evening Standard newspaper “was not approved or condoned” by the company. Rad isn’t a director of Match and wasn’t authorized to make statements on behalf of the company, and figures included in the article on Tinder’s user base and the number of daily “swipes” were “inaccurate,” according to the filing.

Disclosure Rules

The article, in which 29-year-old Rad says he’s “addicted” to the Tinder service and falls in love with a new girl “every other week,” follows other ill-timed interviews during the initial public offerings of technology giants. Match does not plan to remove Rad from his position, Blatt said in the interview Thursday, adding that the article took a lot out of context and that Rad should be careful in how he speaks with certain reporters.

“It’s certainly not his finest moment, but I think he’s created an incredible asset and I’ve got a lot of confidence in him,” he said. “I don’t think we need to put a gag on him.”

In 2011, daily-deal site Groupon Inc. asked investors to disregard comments made by Chairman Eric Lefkofsky, who told Bloomberg the company was “going to be wildly profitable.” Google Inc. said during its 2004 first-time share sale the U.S. securities regulator was investigating whether it violated rules on information disclosure, after founders Sergey Brin and Larry Page granted an interview to Playboy magazine.

IAC will remain the largest shareholder in Match Group after the IPO, owning about 86 percent of the company, filings show. Proceeds from the offering will go toward repaying debt owed to IAC.

JPMorgan Chase & Co., Allen & Co. and Bank of America Corp. managed the sale.