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Martha Lane Fox, Lastminute.com
"We feel we can create a business that's here for the long term"
 real 28k

Industrial Society's Chief Executive Will Hutton
"Everyone who's buying Lastminute.com today knows that the price is absurd"
 real 28k

Friday, 17 March, 2000, 06:29 GMT
Lastminute loss for investors
Lastminute.com founders
Nearly 190,000 people have bought shares
The thousands of small investors who put their money into Lastminute.com saw their profits slashed further in trading on Thursday.

Shares in the internet travel site fell 25p to 387.5, just above the issue price of 380p.

That followed a big fall of 75p on Wednesday, and means most small investors - who were resticted to just 35 shares each and are unable to trade yet - will actually lose money after dealing costs are taken into account.

In the first day of conditional trading on Tuesday, the shares soared before settling back to close at 487.5 - a 28% increase.

The company is now valued at 582m, down from its high during trading on Tuesday of 833m.

Made a profit?
Float price: 380p
Holding: 35 shares
Investment: 133
Value now: 135.62
Profit before dealing charge: 2.62
(Based on price of 387.5p)
The shares were not helped by a global slump in technology stocks.

"It's obviously been caught in this tech rout that's going on, but you could argue it's been priced too aggressively," said one analyst.

Over-subscribed

There have been questions about how a company with small revenues can be worth so much.

Individual investors who applied for shares will receive only 35 each because the offer was so heavily over-subscribed.

"Offering people 35 shares is a complete waste of time. The only people who are benefiting are the merchant banking institutions," said Justin Urquhart Stewart of Barclays Stockbrokers.

Last week the company increased the indicated price range to 320p to 380p from 190p to 230p in the face of frenzied demand for the stock.

Although official trading does not begin until next week, the shares are being conditionally traded.

The company said that 188,995 private investors logged onto the website in recent weeks to apply for the shares on offer.

The minimum value of shares they could apply for was 500. At the float price their 35 share allocation cost 133. The remaining 367 will be returned.

High profile

The share offer was by far the most popular internet retail offering seen in the UK.

The company offers flights, holidays and goods over the internet for late impulse buyers.

Demand for the shares has benefited from the company's high profile.

Founders Brent Hoberman, 31, and Martha Lane Fox, 27, have become the public face of internet start-ups in the UK during the past year.

The placing has made paper fortunes for both of them.

But the fall in the share price has meant a big reduction. Ms Lane Fox's stake in the firm is now valued at 39m, down from 50m on Tuesday, while Mr Hoberman's shares will be worth 61m, down from 77m.
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See also:

15 Mar 00 | Business
Floating out of favour?
09 Mar 00 | Business
Lastminute ups its float price
09 Mar 00 | Business
FTSE fears as new ousts old
02 Mar 00 | Business
Martha my very dear
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