(Reuters) -Shares of Soho House private members club fell 6% in their New York Stock Exchange debut on Thursday, giving the company formally known as Membership Collective Group a market valuation of about $2.6 billion.
The company, which has never turned a profit, sold 30 million shares in its initial public offering (IPO) at the bottom of its $14 to $16 target price range. Its stock opened at $13.5.
Founder Nick Jones opened the maiden Soho House on the first floor of a building in London’s Greek Street in 1995 as a space for the local artists and actors that frequented his downstairs restaurant.
The club in 2003 started its first U.S. house in New York’s Meatpacking District and entered Europe seven years later with a space in Berlin. The house in Germany was originally a department store whose Jewish owners were forced out by the Nazis in 1933, and the Soviet Communist Party later took over the building.
It now has more than 119,000 members across 27 houses in 10 countries, with more openings in Europe, Asia, and North America on the horizon. It also operates London’s The Ned, a club for professionals, and the Scorpios Beach Club in Mykonos.
Soho House’s listing comes at a time when unprecedented government stimulus has created a record appetite for IPOs, prompting scores of start-ups to go public.
The company plans to launch a digital-only membership in late 2021, which will allow members to search for and be recommended to other members, besides being able to communicate through direct messaging, audio and video.
Its majority owner Yucaipa Companies, the private equity firm founded by American billionaire Ron Burkle, has 58.1% of the combined voting power in the company post the offering.
J.P. Morgan, Morgan Stanley and BofA Securities are the lead underwriters for the IPO.
(Reporting by Noor Zainab Hussain in Bengaluru, Additional Reporting by Sohini Podder and Niket Nishant; Editing by Aditya Soni)
