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Skype: Internet calling service files for IPO of up to $100 millionAug 09, 2010 (San Jose Mercury News - McClatchy-Tribune Information Services via COMTEX) -- Skype, the free Internet phone service partly owned by San Jose online auction giant eBay, filed Monday for an initial public stock offering, hoping to bolster its mostly money-losing business. While saying its IPO could be worth $100 million, the Luxembourg-based Skype didn't specify when it intended to sell the shares, how many it would offer and at what price. Some analysts have speculated that Skype's public offering could be the biggest in the technology sector since Google went public in 2004, raising $1.67 billion. Founded in 2003, Skype was bought by eBay in 2005 for about $3 billion, but never lived up to eBay's expectations. In November of last year, eBay sold 65 percent of Skype for $2.025 billion to an investor group that included the Menlo Park venture capital firms Silver Lake Partners and Andreessen Horowitz, headed by former Netscape co-founder Marc Andreessen. Other investors were the Canada Pension Plan Investment Board and Index Ventures of London. Officials at eBay and Silver Lake Partners declined to comment on Skype's proposed IPO. But Joel Achramowicz, an analyst with investment bank Blaylock Robert Van, said having Skype's shares traded openly would give eBay a way to completely cash out of that investment. While it made sense at the time for eBay to hang onto a share of Skype, in case the Internet-phone market got big, spinning off most of Skype was "the best thing they ever did," Achramowicz added. Skype, which had 839 employees as of June and recently said it plans to move about 80 workers into a Palo Alto office park, offers free phone and video communications via the Internet, but charges for calls to traditional phones. The company claimed in its filing Monday to have 560 million registered users, with 8.1 million average monthly paying customers. It also recently announced business deals with Verizon Wireless in the United States, as well as with Panasonic and Samsung, which have put Skype software in some of their gadgets. While earning a profit of $13 million for the first half of this year, it lost nearly $370 million last year and has mostly operated in the red since its inception. It also has run into problems with some mobile phone companies, which have blocked Skype's service or charged fees to customers using Skype. Moreover, it faces stiff competition from other companies offering their own Internet communication services. "For example, Google has recently acquired Global IP Solutions, which has developed a real-time audio and video-over-Internet technology similar to ours," Skype noted in its filing. Skype would trade on the Nasdaq. Goldman Sachs, JPMorgan Securities and Morgan Stanley are the lead underwriters. Mercury News Staff Writer Frank Michael Russell and The New York Times contributed to this report. Contact Steve Johnson at [email protected] or 408-920-5043 To see more of the San Jose Mercury News, or to subscribe to the newspaper, go to http://www.mercurynews.com. Copyright (c) 2010, San Jose Mercury News, Calif. Distributed by McClatchy-Tribune Information Services. For more information about the content services offered by McClatchy-Tribune Information Services (MCT), visit www.mctinfoservices.com, e-mail [email protected], or call 866-280-5210 (outside the United States, call +1 312-222-4544). |