WASHINGTON, Oct 26 (Reuters) - Expedia Inc., the online travel service that Microsoft Corp. plans to spin off, set the terms of its initial public offering Tuesday in hopes of raising an estimated $51.4 million.
Expedia, based in Redmond, Wash., plans to sell 5.2 million shares to the public in a projected price range of $10-$12 per share, according to an amended prospectus filed with the Securities and Exchange Commission.
With Internet sites in the U.S., Canada, Germany, and the U.K., Expedia offers its customers the ability to track the lowest fares between destinations, purchase airline tickets, find hotel rooms and follow links to vacation package websites, among other services.
Its U.S. website is expedia.com.
The company said it plans to use the net proceeds from the IPO, an estimated $51.4 million based on the median $11 per share price, for working capital and general corporate purposes, including possibly increased focus and spending on brand development, sales and marketing, product development, website content and strategic relationships.
After the IPO, there will be about 38.2 million shares outstanding in Expedia, giving the company an estimated $420.2 million market capitalization, based on a $11 per share price.
Microsoft owns 33 million shares in Expedia and after the offering that will amount to 86.4 percent of the company.
The company had about $15.2 million in net revenue during the three months ending Sept. 30 and posted $4.9 million in net losses and loss from operations, according to today's filing.
The company has applied to sell its shares on Nasdaq under the symbol "EXPE."
Goldman, Sachs & Co. and Morgan Stanley Dean Witter are the joint book-running managers for the initial public offering and have been allotted an extra 780,000 shares in case of heavy demand. |
