Internet grocery company Webvan Group
Inc. said Thursday it will halt its financing this week over concerns
raised by the Securities and Exchange Commission.
The SEC is concerned that Webvan officials breached securities regulations
requiring companies to undergo a “quiet period” while preparing an IPO by
cavorting with BusinessWeek and Forbes reporters.
Webvan’s chairman, Louis Borders, was featured on the cover of
BusinessWeek’s issue featuring the top 25 personalities of the
Internet economy last month.
Also, the SEC feels Webvan has been sharing detailed data about its
business results in its road-show presentations this summer — information
not available in the company’s prospectus.
These statistics have been described as largely bullish.
Neither Webvan nor the SEC said when negotiations for an IPO would
continue, but insiders speculate the delay could last a week or two.
Webvan would like to offer 25 million shares to the public, priced between
$11 and $13 each. With 290 million shares outstanding, the company could be
valued as high as $4 billion if the offering is completed as planned.