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Palantir Set to Go Public via Direct Listing

Software giant Palantir Technologies Inc is set to get its public listing later this month following months of planning and recent Securities and Exchange Commission’s (SEC) approval. Palantir gearing up for its public listing issued its third updated prospectus in which it made known its fully diluted share count as well as giving the sum of its unvested and restricted stock.

The data analysis software company noted that it has about 2.17 billion diluted shares. In pursuant to its public listing, Palantir technologies’ market capitalization will not include the entirety of the 2.17 billion shares as some terms have not yet been satisfied for vesting of options and restricted stock units, or RSUs. Per the footnote in the updated prospectus:

“The fully diluted share count as of September 1, 2020 would have been 1,922,795,329, excluding the 250,686,600 shares that are issuable with respect to outstanding options and RSUs that have been granted but have not yet vested or satisfied the service-based vesting condition per their terms.”

As gleaned, Palantir technologies will not be pursuing its public listing through the more popular Initial Public Offering (IPO) but rather by a direct listing. The direct listing will allow existing shareholders to sell a portion of their shares to new investors. As CNBC reported, this rare approach can lead to stock inflation as some investors noted as there will be a limited number of shares available for trading upon debut.

The average price of Palantir’s shares rose from $5.34 in July to $7.31 in August and reached $9.17 on September 1, the last day that private trades could occur. Back in 2015 when the shares were worth $11.38 apiece, the company was valued at about $20 billion.

Ahead of its public listing, Palantir technologies appear to be putting its house in order as the firm has hired a new chief accountant Jeffrey Buckley to join the company to handle the firm’s books and ensure that its processes are in order. Buckley will join the team with his years of experience working as the chief accountant at gaming giant Zynga.

As TechCrunch reported, the move to hire a chief accountant comes after Concerns about Palantir’s audit quality have been percolating since the company’s board of directors has only recently put together the governance committee required to manage the company’s records. Nonetheless, the company has admitted in one of its SEC filings that it won’t have an independent board audit committee until well after it publicly trades.

In pursuant to its public listing, Palantir has revealed that it will debut two classes of stocks, Class A and Class B with plans to authorize a third class of stock namely Class F common stock. As the firm noted, The rights of holders of Class A common stock, Class B common stock, and Class F common stock are identical, except voting, transfer, and conversion rights. Palantir is billed to be listed on the New York Stock Exchange (NYSE) and is on track to start trading by the end of the month.

Palantir Set to Go Public via Direct Listing

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