SAP SE today filed paperwork with the Securities and Exchange Commission for an initial public offering of its Qualtrics subsidiary that values it at between $20 and $24 per share, or about $12 billion to $14.4 billion.

The pricing is preliminary and the amount of stock to be sold has not been specified.

SAP, which announced it was planning the spinoff in July, said Morgan Stanley and JP Morgan are the lead underwriters for the offering, and that Qualtrics will trade on the Nasdaq index under the ticker symbol “XM.” Venture funds associated with Silver Lake Technology Management LLC have already agreed to purchase $550 million worth of stock in the offering, CNBC reported.

Qualtrics, led by its Chief Executive Ryan Smith (pictured), sells software for businesses that enables them to gauge how customers are using their products, so they can make improvements to them where necessary. Qualtrics’ platform is often described as an “experience management” platform, helping companies to obtain feedback on their products so they can be better optimized. The company says experience management is a unique category of software that “enables organizations to succeed in today’s experience economy.”

Qualtrics was actually due to go public in late 2018, only for SAP to step in and acquire it for $8 billion just before its IPO was scheduled.

SAP said the IPO is designed to help “increase Qualtrics’ autonomy and enable it to expand its footprint both within SAP’s customer base and beyond.”

The paperwork submitted to the SEC shows that Qualtrics generated revenue of $550 million and recorded a net loss of $258 million in the nine months through September.

SAP and Qualtrics will be hoping to take advantage of the big interest among investors for high-growth cloud software companies. The market, which was hot even before the coronavirus pandemic, has gained more traction as businesses invest in tools that can better enable remote work.

Several major cloud software companies have made strong public debuts this year, including Snowflake Inc., which raised almost $4 billion on its first day of trading and saw its market capitalization double. Others include DoorDash Inc., C3.ai Inc., Sumo Logic Inc., JFrog Ltd. and Unity Software Inc.

Investors are also looking forward to IPOs next year from the robotic process automation startup UiPath Inc., big-data analytics player Databricks Inc., digital video-game company Roblox Corp. and machine learning automation startup DataRobot Inc.

SAP, on the other hand, has struggled during the pandemic. The company’s stock notably lost almost a quarter of its value in October after it revised its full-year business outlook downward to reflect reduced customer spending on its traditional on-premises software offerings.

SAP said it will still own about 80% of Qualtrics’ stock after the IPO.

Photo: Qualtrics/Facebook