DoubleDown Interactive Raises $113.7 Million In IPO

DoubleDown Interactive, a subsidiary company of DoubleU Games, issued an initial public offering (IPO) on the United States Nasdaq stock exchange. Through the IPO, the company raised about $113,700,000. The impressive amount, however, fell short of original expectations by several million dollars.

Offering 6,316,000 American depository shares (ADS), with each priced at $18.00 and representing 5% of common shares, the company was aiming to raise funds totalling $126,300,000.

Expenses Take A Large Bite Out Of Funds Raised

DoubleDown sold 5,263,000 of the total shares offered while another 1,053,000 came from an anonymous shareholder. DoubleDown will only receive proceeds from the 5.2 million shares that were actually offered by the company.

In addition, a large portion of the funds raised will be lost to underwriting discounts and expenses associated with the IPO. When all is said and done, the company expects to take in net proceeds of approximately $86.5 million.

It is expected that the majority of the funds raised will be used for general corporate purposes but some may also be earmarked for impending legal costs.

Also, triggered by the IPO, Il Sung Kang and Suk Ho Yun, both of whom served as non-executive directors on the DoubleDown board, resigned their positions in accordance with terms set when they were initially appointed to the board.

Successful IPO Comes After Several Setbacks

The DoubleDown IPO was in the works for quite some time. The plan to go public was first announced in June of last year. Then, apparently because of weakened investor sentiment due to the coronavirus pandemic, the plan was put on hold.

When DoubleU finally decided to move forward with its plans to take DoubleDown public and launch an IPO, there was a bit of a false start when the company suddenly announced that it was seeking a new underwriter, claiming that the initial underwriting entity had unnecessarily delayed the process. DoubleDown then filed its registration statement for the Nasdaq listing in June.

In July, the company had no choice but to answer to media reports alleging that some of its executives had been caught selling shares illegally. The company responded only by saying that such claims were β€œgroundless”. The company also found itself on the wrong end of class-action lawsuits in the United States.

DoubleDown is now one of four major social gaming operators to list on stock exchanges so far in 2021. The other three are Playtika, PlayStudios, and Huuuge (Warsaw Stock Exchange).

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