Shares in the U.K’s online late-offers specialist
around 40 per cent when first-day trading began Tuesday morning,
valuing the company at around £1 billion ($1.58 billion).
However, the quarter of a million small investors who applied
for shares were not especially happy with the outcome, securing
just 35 shares apiece. Many savvy investors actually ignored the
offering because trading costs would take most of the profit,
even with the huge premium.
Founded in 1998 by Martha Lane Fox and Brent Hoberman, Lastminute.com
has been the most highly touted Internet launch in the U.K. since
Freeserve last year. In many ways its stock market debut has
been a classic of its kind, with the shares themselves remaining
unpriced until practically the last minute.
Potential investors in Lastminute.com were informed last week
that the price range for the new shares had been changed to
320p to 380p, 30 per cent higher than previously indicated.
In the event, the shares went on sale at the very top of the new
range, rising to 497p during early afternoon trading.
Having first addressed the market for late sales of air tickets,
Lastminute.com extended the concept to gifts, hotels and restaurants,
then rolled out the business in other European countries. Although
it has brought in revenues of only £0.4 million ($0.6 million)
its long-term prospects look promising, always providing that
other sites do not steal its thunder.
Some analysts are already warning, however, that Lastminute.com
will face stiff competition, not least from airlines selling
tickets directly from their own sites. Both
have dramatically increased the number of visitors to their
Web sites recently.
Among the major investors in Lastminute.com are Cheetah
International Investments with a 17.1 per cent stake now
worth over £150 million ($237 million), Intel Corp.,
Amadeus Capital Partners and Global Retail Partners.
Lastminute.com operates sites in France, Germany, Sweden
and the U.K., and has plans for Spain, Belgium and the
Netherlands. It has over a million registered subscribers.