It’s awkward timing for the meal kit company’s IPO

Meal kit trailblazer Blue Apron is going public and is set to begin trading Thursday on the New York Stock Exchange — but its initial stock price won’t be nearly as high as initially thought. The culprit? Amazon — or more specifically, Amazon’s recent play to buy out Whole Foods, a strategic move that’s expected to have a hefty impact on numerous industries.

Blue Apron originally said that the 30 million shares it’s putting up for sale would be initially priced in the $15 to $17 range, but as Bloomberg reports, that’s now been slashed to $10 to $11, or by roughly a third. Even still, the lower stock price would give the company an overall valuation of around $2 billion, which is no small potatoes for a company that has yet to turn a profit.

Grocery store stocks took a hit following the announcement of a potential Amazon-Whole Foods merger, and such a blockbuster deal could also mean some serious competition for Blue Apron. While the meal kit industry has become heavily saturated in the years since Blue Apron launched in 2012, an Amazon-Whole Foods deal could create a potentially game-changing food delivery monolith; both companies have dabbled in meal kits already, and by joining forces, Amazon could use its competition-crushing delivery capabilities to tap into Whole Foods’ loyal customer base.

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SOURCE: Eater
Whitney Filloon