Meal-kit maker Blue Apron slashes valuation expectations by a third

The company said on Wednesday it expects its IPO to be priced between $10 and $11 per share, down from its previous expectation of $15 to $17.

The offering is expected to be priced later on Wednesday.

The new pricing range implies a valuation of up to $2.08 billion, compared with $3.2 billion earlier.

Amazon, which said earlier this month it would buy Whole Foods Market in a $13.7 billion deal, has dabbled in both food delivery, through AmazonFresh, and meal kits, which deliver fresh ingredients and recipes to subscribers.

With Amazon gaining access to Whole Foods' roughly 400-store footprint, the e-commerce juggernaut would command a distribution network dwarfing that of any meal-kit service.

Blue Apron's high marketing costs have also been a concern for investors. Despite doubling its revenue to $795.4 million last year, the company still posted net loss of $54.9 million as it poured money into logistics and marketing.

The company said on Wednesday it expects net proceeds of around $292.7 million from the offering at the midpoint of the range.

Blue Apron was founded in 2012 by Matthew B. Salzberg, Matt Wadiak and Ilia Papas with an objective to deliver ingredients and recipes that would allow customers to prepare meals at home.

Meal kit delivery companies have grown in popularity in the last few years.

A host of young companies such as HelloFresh, Plated, Home Chef, Sun Basket and Chef'd have crowded into the space and are increasingly seeking more funding to grow their operations.

Green Chef, a player in the same industry, recently said it was looking to raise at least $50 million, after already having raised $67 million.