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Twitter files for long-awaited IPO

Thursday, 12 Sep 2013 | 5:04 PM ET
Twitter files for IPO
Thursday, 12 Sep 2013 | 5:05 PM ET
CNBC's Julia Boorstin reports the social media giant, Twitter, has filed for an IPO.

Twitter said in a tweet tonight that it has confidentially submitted a document to the SEC with plans for an initial public offering of stock.

Goldman Sachs is the lead underwriter, sources told CNBC. Other underwriters are expected to be named when the S-1 filing is made public.

Shares of social media companies like Facebook and LinkedIn ticked slightly higher in after-hours trading after Twitter disclosed it had filed.

Goldman leading Twitter IPO?
CNBC's Kayla Tausche reports Goldman Sach is the lead underwriter for Twitter IPO. It is likely more banks will join in as social media site submits the official forms.

The company did not reveal any additional details, including any information on timing or proposed ticker symbol.

Twitter has been valued at around $10 billion. The IPO is likely to be Silicon Valley's most anticipated debut since Facebook went public last year.

(Read more: Twitter files for IPO—and Twitter goes nuts)

The confidential filing was made under the JOBS act, allowing the company to work with regulators on its plans before making them public. The S-1 will have to be made public at least 21 days before the company starts it "roadshow" to convince large investors to participate.

A company has to have less than $1 billion in revenue to file in secret. It is on track to post $583 million in revenue in 2013, according to advertising consultancy eMarketer.

Twitter did not have to disclose they made the filing but chose to do so.

(Read more: Twitter is going public, and its stock ticker symbol is...)

At certain value, Twitter IPO 'not that interesting'
Shares of Twitter, which filed for an initial public offering, could be interesting, but only at the right level, Dan Niles of Alpha One Capital says.

Twitter's revelation comes just days after Facebook shares fully recovered from the plunge they suffered after that company's troubled IPO in May 2012 to reach an all-time high. As of Thursday's close, Facebook is up 17.8 percent from its $38 offering price.

CEO Mark Zuckerberg, who had said companies should avoid going public for as long as possible, softened this week. "In retrospect, I was too afraid of going public...you have to stay focused on doing the right stuff," he said Wednesday at the TechCrunch Disrupt conference.

(Read more: Facebook CEO: Going public isn't so bad after all)

Other social media stocks have done even better. LinkedIn has soared to almost $250 a share from its $45 offering price in May 2011.

Yelp is up 325 percent since its March 2012 IPO, although Groupon is down more than 41 percent since it went public in November 2011.

Twitter's IPO, though much smaller than Facebook's, could still generate tens of millions of dollars in fees from the underwriting mandate itself.

Assuming the company sells around 10 percent of its shares, or $1 billion, underwriters could stand to divide a fee pool of $40 million to $50 million, assuming an overall fee cut of 4 percent to 5 percent, according to Freeman & Co.

- By CNBC.com with contributions from Reuters

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  • Matt Hunter is the senior technology editor at CNBC.com.

  • Cadie Thompson is a tech reporter for the Enterprise Team for CNBC.com.

  • Working from Los Angeles, Boorstin is CNBC's media and entertainment reporter and editor of CNBC.com's Media Money section.

  • Jon Fortt is an on-air editor. He covers the companies, start-ups, and trends that are driving innovation in the industry.

  • Lipton is CNBC's technology correspondent, working from CNBC's Silicon Valley bureau.

  • Mark is CNBC's Silicon Valley/San Francisco Bureau Chief covering technology and digital media.

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