LONDON (Reuters Breakingviews) – Concise insights on global finance in the Covid-19 era.
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LIVE IT UP. Soho House is trying to keep the IPO party going. The operator of private members’ clubs founded by Chief Executive Nick Jones has mandated banks for a New York listing that could value it at $3 billion, the Times reported on Thursday. That’s a big markup from recent fundraisings which valued the group’s equity at $2 billion.
Lockdowns have not been kind to Soho House, whose backers include billionaire Ron Burkle. EBITDA in 2020 was expected to be just 5 million pounds ($7 million), the Telegraph reported. Including debt, the mooted valuation implies an enterprise value of $3.5 billion, according to Breakingviews calculations. To trade on a multiple of 15 times, in line with hotel operators before the crisis, EBITDA would have to reach $233 million, roughly three times what it made in 2018. Investors will need to assign a high value to subscription revenue. Its affluent members, at least, should be happy to chip in. (By Neil Unmack)
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