Question

Q1: According to the article, what aspects of their IPO processes have benefited Warner Music and ZoomInfo and why?

Q2: How have Warner Music and ZoomInfo weathered the fallout from the Covid-19 shutdowns?

Q3: Why do you think Albertsons Cos. and Vroom Inc. might be able to go public in this market environment but Airbnb Inc.'s IPO is likely to be delayed?

DJ Warner Music, ZoomInfo Poised to Boost IPO Market -- 2nd Update

By Corrie Driebusch

Two big IPOs are set to reinvigorate the market for new issues this week, as the rebound in stocks encourages companies forced to the sidelines by the coronavirus pandemic to revive listing plans.

Warner Music Group Corp. and ZoomInfo Technologies Inc. plan to list their shares Wednesday and Thursday, respectively, potentially raising more than $2.5 billion combined. Together with three other companies expecting to make their debuts, the listings would make the week the year's biggest for U.S.-listed initial public offerings, according to Dealogic.

The burst of activity comes after months of relative quiet, with potential issuers scared away by the pandemic and the ensuing economic damage and financial turmoil. With shutdowns beginning to lift, and the benchmark S&P 500 index now down less than 5% on the year, issuers are starting to return. Should this week's crop of IPOs fare well, a host of companies are likely to follow in the coming months, according to bankers.

Grocery giant Albertsons Cos., for example, plans to launch a roadshow to market its shares as early as this month, while online used-car seller Vroom Inc. did so this week.

Some debuts that were to take place in 2020 will likely remain on ice. The pandemic and the dramatic blow it has delivered to the travel and hospitality industry will likely delay Airbnb Inc.'s highly anticipated IPO until at least 2021, according to people familiar with the matter.

And even with the pickup, the IPO market is unlikely to return any time soon to the robust health it enjoyed early last year before stumbling, as investors punished companies with big losses. By the end of December, shares of companies that went public in the U.S. in 2019 were on average up less than the S&P 500, according to Dealogic -- an inversion of what's typical.

Warner Music is targeting a range of $23 to $26 for its shares, which would value the record company at $11.7 billion to $13.3 billion and make it the biggest IPO of the year. The company expects to price the stock in the upper half of that range, according to people familiar with the matter. Warner Music delayed its meeting to set an IPO price to Wednesday morning from Tuesday evening in deference to a move by record labels to suspend work Tuesday in support of the protests over the death of George Floyd, one of the people said.

ZoomInfo, a marketing-data company, plans to sell 44.5 million shares at between $19 and $20 each, a range it boosted Tuesday morning amid strong demand. At the midpoint, the company would raise more than $850 million, making it the biggest technology IPO of 2020.

The other IPOs on deck this week are those of biopharmaceutical companies Applied Molecular Transport Inc. and Pliant Therapeutics Inc. and payment processor Shift4 Payments LLC.

The success of Warner Music and ZoomInfo, measured by how much demand there is for the shares both before and after they start trading, could hinge on steps taken in the months leading up to their official launches.

Executives at both companies were able to speak with potential investors in so-called testing-the-waters meetings before travel came to a near halt. That gave the investors more comfort to put in orders for shares, some of them said, even though they were deprived of the in-person roadshow meetings that precede new listings in normal times. Instead, Warner Music and ZoomInfo executives conducted virtual roadshows, trying through video chats to persuade investors to buy their stock.

Also key for drumming up demand: Both companies worked to secure a significant chunk of their IPO proceeds ahead of time. Warner Music has discussed investments totaling more than $1 billion of its fundraising goal with institutions as well as with the Chinese internet company Tencent Holdings Ltd., The Wall Street Journal reported last week. BlackRock Inc., Dragoneer Investment Group and Fidelity are named as so-called anchor investors planning to buy up to $100 million of shares each in ZoomInfo's IPO, according to a regulatory filing.

Both Warner Music and ZoomInfo appear to be weathering the pandemic relatively well.

ZoomInfo said in the regulatory filing that it expects to experience "slowed growth or decline in new customer demand for our platform" as well as lower demand from existing customers because of the pandemic. Yet the company added that its annualized value of contracts with new customers rose 87% in April from a year earlier.

Warner Music, meanwhile, in April enjoyed a 12% jump in streaming revenue, the largest contributor to its top line. While that was more than offset by decreases related to the coronavirus in segments including ad-supported digital and physical revenue, those areas are expected to recover.

Morgan Stanley, Credit Suisse Group AG and Goldman Sachs Group Inc. are among the banks leading the Warner Music offering. JPMorgan Chase & Co. and Morgan Stanley are leading the ZoomInfo sale.

Answer 1

1. The following aspects have benefited warner music and zoominfo sale

• Both the IPO kept the issue price band low at around 23-26 or 19-20 usd and as such it attracted small investors towards investment opportunities in correcting market.
• Warner music showed its supposed toward public for the incident with G Floyd and gained public attention before ipo.
• The delay in meeting proved to be of postive effects to the company
• Both companies worked to secure a significant chunk of their IPO proceeds ahead of time
• Executives at both companies were able to speak with potential investors in so-called testing-the-waters meetings before travel came to a near halt.
• Warner musics financial and revenue improved in the period due to increased use of streaming services
• Both online ad and offline revenues increased
• Warner Music, meanwhile, in April enjoyed a 12% jump in streaming revenue, the largest contributor to its top line.
• Issue was backed by top investment banks like Morgan, credit s and Goldman

2. Warner Music is a streaming services company, and zoom info ZoomInfo, a marketing-data company, both weathered out of the pandemic being in the defensive sector of the economy.

While other industries were suffering from the shutdown due to pandemic , the demand of streaming services and data agencies increased.

Warner Music, meanwhile, saw a 12 percent spike in streaming sales in April, the biggest contributor to its top line. Although this was more than offset by coronavirus-related declines in sectors, including ad-supported digital and physical sales, these areas are expected to recover.

Warner Music and ZoomInfo tend to weather the pandemic reasonably well.

In the regulatory filing, ZoomInfo reported that it expects to experience "slower growth or decline in new customer demand for our platform" as well as lower demand from existing customers due to a pandemic. However, the company added that its annualized value of contracts with new customers grew by 87 percent in April from the previous year.

43 Albertson cos operates as a grocery giant and already operates in a defensive sector as the consumption of groceries were not impacted by the pandemic situation.

Infact their sales revenue increased due to increased consumption on buying pattern by customers...

Albertson also arranged for a roadshow to demonstrate the opportunity to investors .

Airbnb operating in hospitality sector and hotels and resorts have hard times during this pandemic.

Their revenues were badly impacted and people are not travelling with the travel restrictions imposed during this pandemic times.

Hence investors might not find it attractive to subscribe for the ipo and it may not be a correct time to go public.