ACV Auctions raises $414 million in stock offering; company valued at $3.9 billion

Shareholders of used car online auction company ACV Auctions Inc. raised $414 million in an initial public offering priced above its marketed range.

The company previously expected to raise only about $314 million.

The ACV shareholders sold 16.55 million shares in the IPO for $25 each, according to a statement on Tuesday. The Buffalo, N.Y.-based company, which provides an online marketplace for auctioning used cars, had marketed shares at $20 to $22 each, a range that it earlier elevated from $18 to $20.

ACV shares gained 25 percent to close at $31.25 on Wednesday.

The IPO implies a market value for the company of about $3.9 billion based on the shares listed in its filings with the U.S. Securities and Exchange Commission.

The company’s marketplace was used by more than 16,000 dealerships and other participants last year, according to the filings. ACV’s revenue almost doubled last year while its loss shrank, according to its filings. It had a net loss of $41 million on revenue of $208 million, compared with a loss of $77 million on revenue of $107 million in 2019.

ACV’s biggest backer, Bessemer Venture Partners, will control as much as 29 percent of the shareholder voting power after the listing.

The offering is being led by Goldman Sachs Group Inc., JPMorgan Chase & Co., Citigroup Inc., Bank of America Corp. and Jefferies Financial Group Inc. The shares are expected to begin trading Wednesday on the Nasdaq Stock Market under the symbol ACVA.