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Sunday, 16 April, 2000, 17:34 GMT 18:34 UK
AltaVista postpones flotation
AltaVista home page
The popular US internet portal, AltaVista, has decided to postpone an initial public offering of its shares set for early in the week.

It said it was a very bad time to try to drum up investor interest.


The company's got a lot going for it.

John Fitzgibbon, Red Herring

AltaVista had been planning to offer 14.8 million shares to the public in a deal valued at more than $255m (160m).

It gave no indication when it might try to reschedule the offering, saying only that it would have to wait the market out.

The firm joins a series of other companies that have postponed IPOs because of depressed market conditions.

Yes TV

One of those - Yes TV, which provides video on demand via UK telephone lines - had been due to float on Monday. It has decided to wait until the markets stabilise.

But because AltaVista is larger and more established than many others affected by market weakness, its decision stands out as a sign of more bad news for the high-tech sector.

Even after trading concluded on Friday, with both the Nasdaq composite index and the the Dow Jones Industrial Average registering their biggest one-day point declines, many analysts were predicting AltaVista would go ahead with its IPO.

"It may only go up several points instead of doubling, but it's still a strong deal," said John Fitzgibbon of internet analysts Red Herring.

"The company's got a lot going for it. If it doesn't get priced, you can essentially pack it up and go the the Bahamas for the spring."

Popular

AltaVista, one of the most visited sites on the internet, draws about 12 million visitors a month.

It had revenues of $50.9m (32m) in the three-month period ending on 31 January - well up on a year earlier - but is still making losses.

Since last summer, AltaVista has been 83% owned by the successful internet investment firm CMGI, which aggressively marketed the site and worked to transform it from a bare-bones search engine to a major commercial portal.

Although AltaVista was one of the original internet search engines, it has had bad timing with investors.

It first tried to go public back in 1996, in a deal that was also cancelled because of weak market conditions.

It was later acquired by Compaq Computer Corporation, which spun it off in 1998.

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