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Banks

Palantir goes on Wall Street charm offensive ahead of public listing

(Reuters) - Palantir Technologies Inc, the U.S. data analytics company known for its secretive work with the Central Intelligence Agency and other government groups, on Wednesday sought to woo Wall Street investors ahead of a public listing later this month.

FILE PHOTO: The logo of U.S. software company Palantir Technologies is seen in Davos, Switzerland Januar 22, 2020. REUTERS/Arnd Wiegmann

Palantir, co-founded in 2003 by billionaire Peter Thiel, is among 2020’s most eagerly anticipated public listings, with much conjecture about how much the company is actually worth and whether investors will view it as a lucrative software provider or a less-glamorous consulting business.

In a two-hour presentation to prospective investors, Palantir sought to underscore it revenue growth, diversification away from government contracts and ability to turn a profit, something which has eluded the company for 17 years.

Chief Executive Alex Karp also addressed concerns over Palantir’s use of the data that it helps governments and companies curate and analyze.

“I think, the main difference is that we do not mine, purchase, resell, or in any way monetize data,” Karp said.

The company said its shares will start trading on the New York Stock Exchange on Sept. 23. It said it had registered about 244.2 million shares for its debut, via a direct listing rather than a traditional initial public offering (IPO).

“Historically, periods of macro instability or crisis have been a huge tailwind for us. The global financial crisis, ISIS attacks in Europe in 2015, and 2016, the present day COVID. And it’s a tailwind for us because it means that the competitive alternative of building your own solution in three years or more, is just not viable,” Chief Operating Officer Shyam Sankar said at the investor day.

Unlike an IPO, a direct listing does not raise fresh funds. Instead, existing investors can sell their shares.

Palantir will face scrutiny of its earning and business following years of being viewed as one of the most reclusive U.S. tech companies.

The listing will test the appetite of investors who in recent years have grown more wary of backing loss-making startups, most notably WeWork, which botched its IPO last year.

In its presentation, the company said it had achieved an adjusted operating profit in the second quarter for the first time in its history.

Palantir was valued at about $20 billion in its 2015 fundraising round. In the private market, its shares were trading earlier this year at a valuation of between $10 billion and $12 billion.

Reporting by C Nivedita and Noor Zainab Hussainin Bengaluru, and Joshua Franklin in Boston; Editing by Saumyadeb Chakrabarty, David Gregorio and Tom Brown

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