* IPO could be largest after Facebook chilled markets
* Latest enterprise-software player to tap investors
* Takes advantage of fledgling JOBS Act
By Poornima Gupta
ASPEN, Colorado, July 17 Workday Inc has filed
confidentially for an initial public offering, several sources
told Reuters, putting the Silicon Valley business software
company on track for the largest market debut since Facebook
Inc's (FB.O) problem-ridden May coming-out party chilled demand
for U.S. IPO's.
Workday, backed by Amazon.com Inc (AMZN.O) Chief Executive
Officer Jeff Bezos, filed for an IPO a week ago under a new law
known as the "JOBS" Act, which lets companies keep financial
details contained in IPO documents private for longer, the
Workday plans to debut in October, depending on market
conditions, several of the sources said. Banks selected to run
the offering include Morgan Stanley (MS.N), Goldman Sachs (GS.N)
and JP Morgan (JPM.N), the sources sai d on condition of
Pleasanton, California-based Workday was co-founded by David
Duffield and Aneel Bhusri, ex-PeopleSoft executives who left
that company after its acquisition by Oracle Corp ORCL.O in
2004. It sells human resources and financial management
Many investors have grown disillusioned with high-flying
Internet IPOs over the past year, particularly after Facebook
shed a third of its value after its May 18 debut.
But corporate software companies - which mostly have more
stable, subscription-based business models - remain in demand in
an otherwise weak IPO market.
Data analytics software maker Splunk's (SPLK.O) shares
doubled on their market debut in April and remain more than 50
percent above their IPO price. Other enterprise software
companies that have listed include Guidewire (GWRE.N), Jive
Software JIVE.O and Demandware DWRE.N, and ServiceNow Inc
(NOW.N), which rose 29 percent during its June 29 start.
Workday filed its S-1 with the Securities and Exchange
Commission under the Jumpstart Our Business Startups (JOBS) Act,
a recently enacted law that loosens some of the regulations
surrounding the IPO process, two of the sources said.
It is intended to help companies with less than $1 billion
in revenue go public. Workday's potential buyers will have to
wait longer for their first look at its financials, as companies
who file under the new framework will not have to reveal such
details until 21 days before embarking on an investor roadshow.
JPMorgan, Morgan Stanley and Goldman Sachs declined to
comment. A Workday spokesman declined to comment on its “future
YOU'RE NOT ALONE
Workday is not alone among enterprise specialists still
seeking capital. Network security provider Palo Alto Networks
said on Tuesday it was selling 6.2 million shares at $38 to $40
apiece, raising its range from $34 to $37. [ID:nL4E8IH3XJ]
Workday, which also offers software for day-to-day business
needs such as accounting, has been grabbing business from
companies like Oracle ORCL.O and SAP (SAPG.DE).
Oracle CEO Larry Ellison recently derided Workday for not
using a database and for relying on a Flash interface, saying
that renders it useless on an Apple Inc (AAPL.O) iPhone or iPad.
Workday has said it works on both.
While more and more companies opt to stay private for
longer, Workday primarily decided to tap public markets because
many of its customers are large corporations -- typically more
comfortable working with a public company. It also wanted to
provide liquidity to employees, one of the sources said.
Workday has raised $250 million from venture capital firms
and other investors, including Greylock Partners, New Enterprise
Associates, T Rowe Price, Morgan Stanley Investment Management,
Janus Capital Group Inc JNS.N and Bezos Expeditions, the
personal investment entity of the Amazon CEO.
(Editing by Edwin Chan and Carol Bishopric)
((email@example.com)(415 677 2536)(Reuters
Messaging: Follow me on Twitter @PoornimaGupta))
Keywords: WORKDAY IPO/
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