Oatly IPO Could Be Valued at $10 Billion
Plant-based milk producer Oatly has formally filed for IPO. | Oatly

Oatly Aims for $10 Billion Valuation With IPO

Oatly is seeking a $10 billion valuation for its recently filed IPO, going public at a time when increasing demand for vegan milk in young people is driving the industry.

Plant-based milk producer Oatly confirmed yesterday that it will seek a $10 billion valuation after formally fileing for IPO at the end of April.

The Malmö, Sweden-based company, which entered the U.S. market in 2017, plans to list its ADS on the Nasdaq Stock Market under the symbol OTLY.

It plans to offer nearly 65 million American Depositary Shares in addition to 20 million shares from existing shareholders, each priced between $15 and $17 per share, as reported by Reuters.

Oatly initially announced its IPO back in February, and several outlets reported its goal valuation of $10 billion at the time. The company was valued at approximately $2 billion in July 2020.

Oatly’s IPO bets on generation Z and millenials

Last year, Oatly raised $200 million in funding from various backers led by private equity giant Blackstone. Backers include Oprah, Natalie Portman, former Starbucks CEO Howard Schultz, and Roc Nation — an entertainment agency founded by Jay-Z in 2008. 

At the time of the filing in April, Oatly reported revenue of $421.4 million in 2020, compared with $204 million in 2019, totaling a $60.4 million loss. Its losses a year earlier totaled $35.6 million. 

Oatly plans to raise $100 million from the sale of its depository shares, however, this is a placeholder figure that often changes. It has not disclosed how many ADS it intends to offer.

The cult-hit oat milk brand is going public at a time when sustainability is on the minds of a growing number of consumers, particularly the younger ones.

“Generation Z and Millennials will become the dominant global generations in the coming years, bringing to the market a new set of values and expectations,” Oatly said in its prospectus. “These combined factors are driving a clear rapid, accelerating growth and influx of new consumers to the plant-based dairy market.”

Oat milk shortages and consumer demand

Plant-based milk is a booming market in the U.S., worth $2.5 billion and accounting for 35 percent of the vegan food market, according to SPINS data. Almond milk remains the most popular choice, but oat milk is rapidly catching up.

Since the early days of the coronavirus (COVID-19) pandemic, oat milk has experienced a significant boost in sales — at one point even outselling hand sanitizer. Nielsen Data revealed that oat milk sales increased by 476.7 percent in a single week-long period ending March 14.

Over 20 different countries across Europe and Asia now sell Oatly products, and cafes and coffee shops favor its Barista blend, in particular. Oatly is now widely available in the U.S., including from large chains such as Starbucks, Kroger, and Walmart.

The company gained further attention during Super Bowl LV with its first, intentionally divisive, mid-game commercial slot. This is in keeping with the company’s aim to get consumers thinking or talking about plant-based milk, one way or another.

“It’s just the right time right now for us to make a bigger statement to the whole national audience,” explained John Schoolcraft, Oatly’s chief creative officer.