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Wednesday, 1 December, 1999, 15:24 GMT
Freecom booms on market debut


Shares in one of the UK's fastest-growing internet companies, Freecom, have rocketed on its debut on the Alternative Investment Market in London.

Trading opened at 310 pence - a 138% premium on the 130p initial public offering price.

At one time, shares were showing a 173% premium.

By 1500 GMT they had fallen back to 290.5p - still a 123% premium on the offer price.

Freecom - which was set up in 1991 by husband and wife team Michael and Caroline Williams - describes itself as a "specialist provider of hosted e-commerce solutions for small to medium-sized enterprises.

"We offer a complete design, e-commerce and support service for all aspects of your organisation's web presence."

Oversubscribed

Its 41% flotation - an issue of 15.39 million shares valuing the company at 48.8m - was 20 times oversubscribed.

Last week, the company increased the scale of the issue to raise 20m, having originally planned to raise 12.5m.

It says it will use the money to fund expansion of its marketing operations, server upgrades and possible acquisitions.

It says it is talking to a number of parties about international ventures in the future.

365 Corporation

Analysts and dealers said Freecom's meteoric rise augured well for 365 Corporation, which debuts on Thursday.

365 provides sport, music and lifestyle content to third parties, and is behind such websites as Football365.

It announced on Wednesday that its issue price would be 160p per share, valuing the company at 285m - the top of the previously indicated range.

Share dealers were speculating that the stock would soar, with financial bookmakers quoting a range of 224p to 236p.

The offer of 47.2 million shares will raise 75.5m, with 50m going towards funding further product development and investment in new services.

365 will be the UK's fourth-largest internet issue this year, after service provider Freeserve, auction house QXL, and financial services group eXchange Holdings.

One London-based fund manager, who has stock in Freecom and 365, said he expected 365 to surge ahead but that Freecom's gains had been "overdone".

"Freecom was always going to go well but I think it's far too much in the short term. I certainly will not be buying at this level," he said.

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See also:
16 Nov 99 |  The Company File
Freeserve shares surge
07 Oct 99 |  The Company File
QXL shares modest rise on debut
06 Aug 99 |  The Company File
UK Internet stock flies on debut
24 Sep 99 |  The Company File
eXchange losses treble - shares rise
29 Sep 99 |  The Company File
Freeserve users - and losses - up

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