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Snap will be able to drive a hard bargain with banks thanks to the long IPO drought

A dearth of big tech IPOs has left Snap with the upper hand on Wall Street, according to The Wall Street Journal.

Snap will give banks a 2.5 percent share of its upcoming initial public offering, the Journal reported on Friday. That rate is the third-lowest ever for a major technology offering, according to Dealogic data obtained by the Journal.

Because Snap is one of the only major IPOs in the pipeline, bankers are "struggling to generate fees" and "have little room to push for more," the Journal said. The messaging and augmented reality company will go public after the IPO market hit a 7 year low in 2016, according to Renaissance Capital.

Proceeds from 2016 IPOs were their worst since 2003, Renaissance said. And there are 37 percent fewer U.S.-listed companies since the high in 1997, according to Fortune magazine.

That translates into more leverage for Snap to dictate favorable terms for its deal, the Journal reported.

Snapchat and Goldman Sachs declined to comment to CNBC. CNBC reached out to the other major banks involved, and they were not immediately available for comment.

For more on the story, see the full article at WSJ.com