Twitter Inc priced its initial public offering above its expected range to raise at least $1.8 billion, in a sign of strong investor demand for the most highly anticipated U.S. public float since Facebook Inc.
The microblogging network priced 70 million shares at $26, above the expected range of $23 to $25, which had already been raised once before.
The IPO values Twitter at $14.1 billion, with the potential to reach $14.4 billion if underwriters exercise an over-allotment option, as they are widely expected to.
If the full overallotment is exercised, Twitter could raise $2.1 billion, making it the second largest Internet offering in the U.S. behind Facebook's $16 billion IPO last year and ahead of Google Inc's 2004 IPO.
Some analysts said they expect shares of Twitter to experience a small pop during the first day of trading. Twelve-month price targets on the stock range from $29 to $54.
David Menlow, president of research firm IPO Financial, said it's unlikely that Twitter will see shares soar initially but a smaller size pop is possible.
"I think you could see shares rise 10 percent but there are still a lot of naysayers out there who think the stock is overvalued," he said.
Twitter's public float comes amid the strongest market for U.S. IPOs since 2007, as equity markets soared and uncertainty around the U.S. debt ceiling has largely subsided for now.
A number of IPOs have doubled on their first day of trading including Container Store Group, restaurant chain Potbelly Corp and software company Benefitfocus Inc .
Twitter hiked its target IPO price on Monday from an initial range of $17 to $20. All of the proceeds from the IPO will go directly to the company, with no insider selling taking place.
Investor enthusiasm for Twitter, which boasts 230 million users including heads of state and celebrities, is strong even though the microblogging network has never turned a profit.
Goldman Sachs Group Inc, which led the Twitter IPO, tops the list of U.S. technology bookrunners this year with an 18.3 percent market share, up from 11 percent a year ago when it ranked fifth, according to Thomson Reuters data.
Morgan Stanley and JPMorgan Chase & Co also led the IPO.
AVOIDING FACEBOOK'S MISTAKES
Twitter has been focused on avoiding many of the pitfalls that plagued Facebook during its $16 billion IPO last May. The company priced shares more conservatively than Facebook did and chose to list on the New York Stock Exchange rather than