Visa's IPO: The Next Big Thing

On Monday, Visa announced that it was looking to raise $19 billion from its initial public offering (IPO), which would make it the largest in U.S. history.

As the AP reports:

Visa said in a Securities and Exchange Commission filing it will offer 406 million shares at $37 to $42 per share. There will be an option for underwriters to buy an extra 40.6 million shares to cover any excess demand.

The Visa IPO, even if it prices at the low end of the estimated range, would surpass the $10.6 billion AT&T Wireless raised in 2000 when it went public. And if demand is strong enough, it could be almost as big as the two largest past deals combined _ AT&T's offering and Kraft Foods' $8.7 billion offer in 2001.

Visa would follow MasterCard from being a privately held interest to a publicly traded company. MasterCard raised $2.39 billion in its IPO nearly two years ago.

But as Forbes warns:

The IPO, which will probably be priced at mid-March, comes during a weak market. Sal Morreale, an analyst at Cantor Fitzgerald, noted that one of the first areas to slow in a protracted downward stock market is IPOs.

"You can't gear to what the appetite is until the company basically goes out and starts making presentations on their road shows," said Sal Morreale, an analyst at Cantor Fitzgerald, "if the market was up big, it'd be a slam dunk, but it's a 'wait and watch' game now."

Adds MarketWatch: Visa would rank as No. 68 in S&P 500 based on its IPO price.

Comments

[nomoredead]

I'm going to buy some Countrywide too.

[Justinpassing]

OOOOHHHH YEAH, I'm gonna get me a ton of that(not)

[Sundialsvc4]

My number-one question about an IPO like this is: "I know what's in it for Visa, but what's in it for the investors who buy those shares?"

Yes, Visa International is basically a service company that facilitates the business of other banks who actually hold those loans, but in THAT regard is it really different from any other interbank company?

Is this, in other words, just a not-so-thinly disguised ... bailout?

[WIpatriot]

Just what I was thinking, Sundial, just what I was thinking..­..