Blue Apron sharply lowered the expected price range for its initial public offering as Amazon-Whole Foods deal weighed on prospects for the meal-kit industry. Fred Katayama reports.
Blue Apron slashed the price range for its initial public offering. It's now down to between $10 to $11 per share from its previous estimate of $15 to $17 per share. Sources said potential investors expressed concerns about Blue Apron's marketing costs and lack of profitability. They also worried that the company has a new, powerful competitor - Amazon, which has a small meal-kit business, is buying Whole Foods. Pacer ETF Distributors' Sean O'Hara: (SOUNDBITE) SEAN O'HARA, PRESIDENT, PACER ETF DISTRIBUTORS, (ENGLISH) SAYING: "They're having a hard time getting the repeat customer business. I don't know how exactly they really operate the business, but getting people to become real customers as opposed to people "just trying out" seems to be one of the challenges that they have." Blue Apron's new pricing guidance gives the company a valuation of up to $2 billion. The company's shares are expected to begin trading on the New York Stock Exchange on Thursday under the symbol APRN.