LinkedIn (NYSE:LNKD) is connecting itself to the capital markets in a major way. The company announced that it will float an underwritten public issue of $1 billion worth of its class A common stock. The offering's underwriters are to be granted a purchase option for up to an additional $150 million in the shares.
LinkedIn said it plans to use the proceeds of the issue to "increase [its] financial flexibility and to further strengthen its balance sheet." More specifically, it will use the funds mainly to boost working capital, expand its product development and sales efforts, and lift its presence in international markets. It might also spend some of the money on acquisitions and investments.
The lead bookrunning managers of the issue are JPMorgan Chase unit J.P. Morgan Securities and Morgan Stanley. Goldman Sachs and Bank of America's Merrill Lynch are its joint bookrunning managers.
At the moment, LinkedIn has just over 112 million class A shares outstanding, and its stock most recently closed at $246.13 per share.
Fool contributor Eric Volkman has no position in any stocks mentioned. The Motley Fool recommends Bank of America, Goldman Sachs, and LinkedIn and owns shares of Bank of America, JPMorgan Chase, and LinkedIn. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.