Airbnb Turns Down IPO Approach Through Bill Ackman’s SPAC

Airbnb has rejected investor William Ackman’s offer to merge with his newly formed blank-check company to go public.

Sources told Bloomberg the home rental platform said rather than joining a special purpose acquisition company (SPAC) or blank-check company, a shell firm that plans to go public by acquiring or merging with a company,  it prefers a traditional initial public (IPO).

Still, the news service reported the San Francisco-based online vacation rental marketplace has not ruled out a merger with Ackman’s Pershing Square Tontine Holdings Ltd., the New York-based company formed to effect a merger, capital stock exchange, asset acquisition, stock purchase or reorganization with a private company.

Discussions with Ackman ended when Airbnb filed confidentially for an IPO in August, Bloomberg reported.

Ackman’s SPAC raised $4 billion in an IPO in July. He told investors last week that he was holding discussions with a number of potential companies, including Airbnb, sources told the news service.

“We would certainly take a look at a company like Airbnb,” Ackman told Bloomberg TV in July. “I’ve always admired the business. I’ve admired its economic characteristics.”

Last month, Airbnb said it filed a draft registration statement for an IPO, according to a press release. The IPO, much publicized and anticipated before the pandemic, will likely take place once the Securities and Exchange Commission (SEC) completes its review process, which is subject to a variety of market conditions.

Airbnb has said it still wants to go public by the end of the year, in spite of its 40 percent decrease in valuation in three years, PYMNTS reported. Airbnb was valued at $31 billion in 2017, but only at $18 billion this year.

Also in August, PYMNTS reported SPACs are gaining traction. It is estimated there have been 79 SPAC IPOs have been issued in the U.S, which raised $32.1 billion. That beats the 59 such IPOs that raised $13.6 billion in 2019.

In July, Brian Chesky, Airbnb’s CEO, told Reuters his company had been approached about a merger with a so-called blank-check acquisition company.

“We’re looking at everything,” Chesky told the news service at the time. “So I probably shouldn’t speculate too much on it.”