Key Takeaways
Goldman Sachs and Morgan Stanley are splitting their banking teams into two camps to handle what could be dueling initial public offerings from OpenAI and Anthropic this fall, an unprecedented arrangement that reflects the two firms' dominance in technology underwriting.
The artificial-intelligence rivals filed confidential IPO paperwork within days of each other earlier this month, putting them on track for offerings as soon as August, though post-Labor Day launches are more likely, people familiar with the matter said. Both Goldman Sachs Group Inc. and Morgan Stanley are expected to serve as lead underwriters on each deal — but with entirely separate teams of bankers to prevent any information from crossing between the two mandates.
"It is extremely rare for two direct competitors to go public simultaneously using the same lead underwriters, and the conflict walls being erected here are unusually high," said Tom Brennan, an IPO and M&A analyst at Edgen. "The last comparable situation was Uber and Lyft in 2019, and even then, the banks split cleanly — no firm led both."
When Uber Technologies Inc. and Lyft Inc. went public in 2019, JPMorgan Chase & Co., Credit Suisse Group AG and Jefferies Financial Group Inc. led Lyft's offering, while Goldman, Morgan Stanley and Bank of America Corp. led Uber's. This time, Goldman and Morgan Stanley are expected to play major roles in both OpenAI and Anthropic, reflecting their stranglehold on large technology IPOs.
The full bank lineups for each offering are not yet finalized, but the scale of the deals will require an army of underwriters. SpaceX's $86 billion IPO last week — which used 23 banks — generated roughly $500 million in total fees, with Goldman and Morgan Stanley each collecting about $100 million, according to people familiar with the matter. OpenAI and Anthropic are eyeing jumbo-sized offerings of comparable magnitude.
Both companies bring distinct complications for advisers positioning their IPOs. OpenAI has been trying to close the gap with Anthropic in the race for lucrative enterprise customers. Anthropic, meanwhile, faces potential headwinds from the Trump administration, which recently banned foreign use of its most powerful AI tools, though the two sides are discussing a possible deal to restore access.
Bankers at Goldman and Morgan Stanley who worked on the SpaceX offering avoided weighing in on the two AI companies' preliminary IPO paperwork, some of the people said, given that SpaceX has a nascent AI business and is considered a rival. OpenAI has said that "it may be a while" until it goes public because there are "things we want to do that are likely easier as a private company."
The year is on track to be one of the busiest for IPOs in years after a prolonged period of muted activity, with activity concentrated in larger offerings of AI-related and defense companies. The dueling AI IPOs would mark a milestone for the sector, potentially drawing significant investor demand and further concentrating underwriting power among the top-tier banks.
This article is for informational purposes only and does not constitute investment advice.
