Deliveroo looks to raise £1bn through London listing

Deliveroo expects to raise around £1bn from its planned London flotation, the food delivery firm said on Monday.

The company said its final offer price would be determined following the book-building process, although it is expected to be valued at around £5bn. But it confirmed that the new shares issued are expected to raise gross proceeds of around £1bn, and that they will be admitted to trading on the London Stock Exchange's main list.

The initial public offering will have a dual-class share structure, with Class B shares held solely by chief executive Will Shu, who founded the business in 2013.

Class A shareholders will be entitled to one vote per share, while Shu will be entitled to 20 votes for every Class B share he holds. Only Class A shares will be offered in the IPO and be admitted to trading. The structure is planned to last for three years, after which all Class B shares will automatically convert to Class As.

Dual-class share structures are rare in the UK although they are more common in the US. But a review backed by chancellor Rishi Sunak and led by former EU financial services commissioner Lord Jonathan Hill is looking to significantly reform UK company listing rules, to help London better compete post Brexit.

Deliveroo, which has set aside more than £112m to cover potential legal costs relating the employment status of its delivery riders, first announced plans to float earlier this month.

The London-based firm has around 100,000 riders worldwide, most of which are self-employed. However, cases over their employment status are ongoing in a variety of countries, including the UK and France.