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Overstock Takes It Public

Q. Is the long drought over for successful Internet IPOs?

A. A resounding "maybe."

The online retailer of closeout goods prices at $13 a share, raising the question of whether the long drought in Internet IPOs is coming to an end.

Still, the company raised $39 million, and though that's nothing compared to the heyday of Internet IPOs, it's not exactly hay.

Salt Lake City-based Overstock, an e-commerce "closeout" retailer offering discounted brand-name merchandise, sold 3 million shares via co-managing underwriters WR Hambrecht + Co and Cantor Fitzgerald using WR Hambrecht's OpenIPO system, an electronic, auction-based method of conducting initial public offerings.

The move follows other recent Internet IPOs, including that of DVD rental company NetFlix last week and before that, e-payments outfit PayPal . And there are said to be three more Internet-related IPOs in the pipeline, including travel operation Orbitz, eclipsing the one IPO in that sector last year.

NetFlix went public at $15 a share and closed Wednesday at $15.45. PayPal has been the real success story, going public at $13 a share last February and closing Wednesday at $29.

Like the others, Overstock went public with "a history of significant losses," and in fact it lost $14.2 million last year on revenues of about $40 million, so investors are clearly betting that the Internet recession is easing and this company and others will eventually make some real money.

Overstock's product offerings include bed-and-bath goods, kitchenware, watches, jewelry, electronics, sporting goods and designer accessories.

The IPO was done via an auction process in which people registered with WR Hambrecht got to bid on the IPO and get access to it at the offering price.