QXL Ltd, the UK-based online auctioneer, is set to make an initial public offering in the next couple of months, valuing the company at anything up to $1.2bn, according to reports. UK newspapers speculated yesterday that a dual listing on the Nasdaq market and a European exchange will come in September, to capitalize on the high-profile IPO of internet service provider Freeserve by Dixons Group Plc. Credit Suisse First Boston, which is handling Freeserve’s flotation, is believed to be also acting for QXL.
QXL, which has operations in France and Germany as well as the UK, says it has 100,000 registered users. This means the speculated 750m-pound (almost $1.2bn) valuation would put a price tag of roughly $12,000 on each registered bidder. This compares to a $2,100 value on each of Freeserve’s 1.5 million subscribers and around $9,000 per registered user for US-based internet auction house eBay Inc. Other reports estimate QXL’s valuation price at 500m pounds ($788m) which works out to $7880 per user.
Critics argue that the company will be overvalued, especially as eBay, with its $18bn market capitalization, is making moves in Europe and will prove a formidable opponent. eBay recently bought 50,000-user German auction house alando.de.
QXL also announced yesterday a $30m equity injection from French investor Group Arnault. The money will be used to push the QXL brand ahead of the IPO. QXL’s revenue reached $6m in its fourth quarter last year, and is believed to be growing at 25% a month. Nobody at QXL was willing to comment on the IPO plans.
