BETFAIR will this week publish the prospectus for its long-awaited flotation, which will set out how many shares it will sell to stock market investors and at what price.
The prospectus for the initial public offering (IPO) will be published on Thursday and is expected to value Betfair at up to £1.2 billion. However, Betfair could be forced to cut the price of its flotation as institutional investors fear the betting company has been overvalued by its bankers. Betfair’s IPO is being run by Goldman Sachs, Morgan Stanley, Barclays Capital and Numis.
Commenting ahead of the prospectus’s publication, several institutional investors told the Financial Sunday Express they fear the Betfair IPO will be similar to the debacle that was Ocado’s flotation.
Ocado was forced to cut the price of its flotation from £1 billion to £800 million after investors threatened to snub the share offering on valuation grounds. Ocado’s IPO was managed by Goldman Sachs.
The head of one City investment group said: “The Betfair story is quite good: people are comfortable with it. The danger is that it gets an exaggerated valuation.
“Some people have been put off the IPO as they believe Goldman will overvalue it.”
Betfair
10-04-2010, 07:01 PM
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