... to raise $5 billion at a valuation of $134 billion ...

[yabi]

What is the meaning of the following sentence?
Nov 30 (Reuters) - Data analytics firm Databricks is in talks to raise $5 billion at a valuation of $134 billion, which is roughly 32 times this year’s expected sales of about $4.1 billion,

Specially I don't understand the meaning of "valuation" and what is the relationship between 5 and 134 in this calculations?

source:

https://www.investing.com/news/stock-market-news/databricks-in-talks-to-raise-capital-at-134-billion-valuation-the-information-reports-4382628

 

[emsr2d2]

I'm not an expert in financial jargon but I would take it to mean that the company is valued at $134 billion, and on the basis of that valuation they're now looking to raise $5 billion from investors or similar. I'm very happy to be corrected on that by someone who knows more about finance.

 

[yabi]

I'm not an expert at financial jargon but I would take it to mean that the company is valued at $134 billion, and on the basis of that valuation they're now looking to raise $5 billion from investors or similar. I'm very happy to be corrected on that by someone who knows more about finance.

Thanks for your reply. So basically it is adequate for me to get the following interpretation:
Company is valued $134 billion and want to increase it to 134+5.
Am I correct?

 

[emsr2d2]

Thanks for your reply. So Basically, it is adequate for me to get the following interpretation interpret it like this:
The company is valued at $134 billion and they want to increase it value to 134+5 $139 billion.
Am I correct?

You're stretching my knowledge here but I'm going to say that that's not right. The valuation of a company is based on a lot of factors, not just the amount of actual cash investments. It can be based on past results and predicted future results/income. It's possible that that extra investment of $5 billion might result in the company's valuation shooting up to, say, $160 billion. I think that's because an investment of an extra $5 billion might make the company seem even more successful and prominent. Again, I could be wrong!