Energis, which does not expect to make a profit until 2001, is owned by National Grid. The sale of 26 per cent of the shares is expected to raise up to pounds 228m. The shares were priced at between 250 pence and 325 pence and are due to start trading in London and New York on Tuesday.
It is conventional practice to value companies, which are not profit making at the time of their sale, by "net present value" rather than on the basis of earnings per share. Net present value estimates cash flows into the future. Most of the recent telecommunications companies have been sold on this basis.
"People don't trust these sales based on net present value after the experience with Telewest, Eurotunnel and others," said Steve Scruton, telecommunications analyst at HSBC James Capel.
Shares in Telewest, the cable company, are worth less than half than their sale price of 182p in November 1994 at Friday's closing price of 73p. Shares in Ionica Group, a company that competes with British Telecom with a wireless service, are worth around a quarter of their sale price of 390p at 102.5p.
Mr Scruton said Energis could be worth less than a third of the pounds 1.3bn valuation set in August by the investment bank Dresdner Kleinwort Benson, which is managing the flotation.
Energis has spent pounds 575m building a nationwide fibre-optic network by stringing cable along the National Grid's electricity pylons, which it claims is more advanced than its rivals' networks. It targets only business customers with high-volume advanced services because they offer bigger margins.
Energis has had its share or problems, including management disagreements, which led to the departure of former chief executive David Dey in 1995.
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