Google Floats as Demand Sags

Google has floated at a US$85 (€68.7) share price, considerably less than the original valuation of US$108 to US$135 (€88 to €110). The company also issued less shares – only 19.6 million, where 25.7 million had been planned initially. It is thought that executives held on to parts of their stakes because of weak demand. Only 5.5 million shares were issued to private investors, less than half the number first bandied about. The shares were issued in a Dutch auction – bids are ranked from highest price down and shares are allocated. Pundits feel that by releasing less shares, the stocks did not have to be sold to the lower bids – sneaky.

The IPO will raise US$1.67 billion (€1.35 billion) for Google, making it the fourth largest this year. Though, since many IPOs have been cancelled in the last few months, that isn’t saying much.

The float values Google at US$23 billion (€18.6 billion), down from the US$36 billion (€29.1 billion) suggested when optimism for the share sell off was at its highest. To give some perspective, Amazon is valued at US$16 billion (€13 billion).

The Google Prospectus

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Fraser Lovatt

Fraser Lovatt has spent the last fifteen years working in publishing, TV and the Internet in various capacities, and believes that they will be seperate platforms for at least a while yet. His main interests at the moment are exploring where Linux is taking home entertainment and how technology is conferring technical skills on more and more people.Fraser Lovatt was born in the same year that 2001: A Space Odyssey was delighting and confusing people in the cinemas, and developed a lifelong love of technology as soon as he realised that things could be taken apart, sometimes put back together again, but mostly left in bits or made into something the original designer hadn't quite planned upon.At school he was definitely in the ZX Spectrum/Magpie/BMX camp, rather than the BBC Micro/Blue Peter/well-behaved group. This is all deeply ironic as he later went on to spend nine years working at the BBC.After a few years of working as a bookseller in Scotland, ("Back when it was actually a skilled profession" he'll tell anyone still listening), he moved to England for reasons he can't quite explain adequately to himself. After a couple of publishing jobs punctuated by sporadic bursts of travelling and photography came the aforementioned nine years at the BBC where he specialised in internet technologies and video.These days his primary interests are Java, Linux, videogames and pies - and if they're not candidates for convergence, then what is?