Despite the best endeavours of newspaper rival John Fairfax to cruel the listing of
Seek.com, the hottest Australian internet float since Looksmart closed
over-subscribed on Friday and was expected to debut strongly on the ASX at midday
despite the weaker broader market. Alas, somthing has gone wrong and the midday listing has been delayed
until tomorrow, although the match price showing up on broker screens
would have been $2.09 a pop – a 1c discount to the issue price
announced on Friday.

Investors have still largely ignored the gloomy Fairfax attack

revealed by Crikey last week. With 280 million shares on issue, the $2.09 match price capitalises the
company at $585 million and makes it the biggest internet company listed on the
Australian market, surpassing Looksmart.

Whilst not an IT company – Seek simply sells classified ads over the
internet – it will be worth more than our biggest IT company, MYOB, which is
capitalised at $414 million after last year’s merger with Solution 6.

New investors paid $2.10 a share for the 77 million shares sold in the
Seek float, which was below the upper limit of 85 million shares,
although the price was towards the top of what was
regarded as a bullish range of $1.80 to $2.20.

Having the Packer
family’s PBL as a cornerstone 25% shareholder that was also
prepared to top up with an additional $8.4 million investment at the
$2.10 float price certainly provided extra confidence for investors.

The Packers today hold about 70 million shares which cost them $41
million or an average entry price of just 58c. At $2.09 a share, this
stake is worth $146 million and is worth more than the $132 million
valuation on the entire company
when PBL first bought 25 per cent for $33 million in October 2003,
gazumping John Fairfax which dismissed this as excessive at the time.

Check out all the Seek ASX announcements here

as you’ll hopefully get a list of the top 20 shareholders before the end of the day and an explanation for the delay.

The joint founders of Seek, Melbourne brothers Andrew and Paul
Bassat and Irvin and Matt Rockman and collectively selling down from
majority control to about 20 per cent, as the majority of the $162
million raised in the float is being used to buy back and cancel some
of their shares. They have agreed not to sell any more shares until
July 1, 2006 and did not sell the maximum amount flagged in the Seek
prospectus.

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Peter Fray
Peter Fray
Editor-in-chief of Crikey
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