Shares Lag For Online Lotto Company
Published: Wednesday, October 12, 2005 Online-Casinos.com
SHARES LAG FOR ONLINE LOTTO COMPANY
German company raises cash on IPO but shares fall 4.6 percent
It appeared that the lacklustre performance of the interactive gaming IPO market was set to continue today as Bloomberg reported that shares of Tipp24 AG, a German company that offers free online services for the state lottery, fell on their first day of trading.
The decline came after the company raised about Euro 88.2 million ($105.8 million) in an initial share sale.
The stock declined as much as 95 cents, or 4.6 percent, to Euro 19.5 in Frankfurt. Tipp24 AG sold 4.7 million shares to retail and institutional investors for Euro 20.50 each, at the top of a price range of Euro 16.50 to Euro 20.50.
About 30 million Germans participate in lottery games in a market Tipp24 values at about Euro 10 billion. The company plans to use the proceeds from the share sale to expand in other European countries and prepare for new regulation that lets lottery companies pool games across European country boarders.
``This is the right time to do it,'' Jens Schumann, co- founder of Tipp24, said in a television interview. ``We see a lot of movement in the market.''
Hamburg-based Tipp24 will receive proceeds worth Euro 40.6 million from the offering, the company said in a statement. Private investors purchased 9 percent of shares sold and 18,000 shares were allocated to employees, not including management or supervisory board members.
Founded in 1999, Tipp24 employs 100 people in Germany and Spain and has distributed Euro 100 million in winnings to some 1.2 million customers, according to its Web site. Tipp24 has been profitable since December 2001.
Deutsche Bank AG and Morgan Stanley managed the Tipp24 IPO.
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