By Manya Saini
(Reuters) – LNG exporter Venture Global on Wednesday cut the valuation it was seeking for its U.S. initial public offering to $65.33 billion, significantly less than the more than $100 billion it had initially targeted.
The company also reduced its offer price, effectively increasing the number of shares for sale amid a backdrop in which analysts warned that its high target valuation and small float could deter potential investors.
It now aims to sell 70 million shares at a price range of $23 to $27 to raise $1.89 billion, compared with its previous goal of selling 50 million shares at a price of $40 to $46 each to raise up to $2,300. million dollars.
“Offering more shares at a lower price would imply that it needs to raise a specific amount of money in the IPO, but the prospectus says there is no specific plan for how and where it will apply new funds,” said Dan Coatsworth, investment analyst at AJ Bell.
“It is unusual for a company to increase the number of shares it plans to issue in an initial public offering.”
The price of an IPO is not guaranteed to be within the range provided at the beginning of the formal marketing process, and making adjustments is relatively common. The final price is usually dictated by demand from investors, subscribers and the company.
The sale of Venture Global shares coincides with Trump's issuance of an order to resume processing export permit applications for new LNG projects, in a bid to increase U.S. energy production and dismantle policies climate of its predecessor.
His decision could pave the way for nearly 100 million metric tons per year of additional LNG by 2031 through projects that are significantly advanced, further cementing the United States as the world's largest LNG exporter.
The order reversed a pause on permitting for new projects that was implemented in early 2024 to study the environmental and economic effects of the booming export industry.
Reuters first reported the revised IPO plans on Tuesday, citing a source.
Venture Global exports LNG through a process in which the gas is cooled into a liquid for transport to various international markets, including Europe and Asia.
“Building export terminals is expensive and Venture Global's listing on the stock market will allow it to tap into the capital markets for financing,” Coatsworth said.
Global demand for LNG has been increasing as the world transitions to cleaner energy sources.
The United States, a key supplier to European and Asian countries, has become the largest exporter of supercooled gas, boosted by abundant reserves and the rapid development of LNG terminals along the Gulf Coast.
Venture Global has five LNG projects in various stages of development near the Gulf of Mexico in Louisiana and expects to have total peak production of 143.8 million tons per year.
The company, founded in 2013 by former investment banker Michael Sabel and financial lawyer Robert Pender, intends to list on the New York Stock Exchange under the symbol “VG.”
Its IPO is backed by a syndicate of Wall Street banks led by Goldman Sachs, JP Morgan and BofA Securities.
!function(f,b,e,v,n,t,s){if(f.fbq)return;n=f.fbq=function(){n.callMethod? n.callMethod.apply(n,arguments):n.queue.push(arguments)};if(!f._fbq)f._fbq=n;n.push=n;n.loaded=!0;n.version=’2.0′;n.queue=();t=b.createElement(e);t.async=!0;t.src=v;s=b.getElementsByTagName(e)(0);s.parentNode.insertBefore(t,s)}(window, document,’script’,’https://connect.facebook.net/en_US/fbevents.js’);
