Google files for long-awaited $2.7bn flotation

Google, the internet's leading search engine, filed its much-anticipated plans for a initial public offering last night, igniting widespread excitement about a possible recovery in the technology sector four years after the bursting of the dot.com bubble.

Google, the internet's leading search engine, filed its much-anticipated plans for a initial public offering last night, igniting widespread excitement about a possible recovery in the technology sector four years after the bursting of the dot.com bubble.

The Silicon Valley company, which has gone from garage start-up to household word in just five years, said it hoped to raise up to $2.7bn (£1.5bn) using an auction system designed to make more shares available to individual investors, who often lose out to institutions in popular IPOs. Morgan Stanley and Credit Suisse First Boston have been picked to manage the flotation.

The filing also revealed that Google will issue two classes of shares, which will allow the co-founders Larry Page and Sergey Brin to retain control through Class B shares with 10 times the voting rights of the Class A common stock being sold.

Google said it would list on the New York Stock Exchange or Nasdaq, but the filing did not specify a share price, and no date was given, although it is likely to be several more months before the stock goes on sale. Analysts believe the company is worth between $20bn and $25bn, though the auction sale may push the price much higher.

The filing revealed that Mssrs Page, 31, and Brin, 30, own 77.1 million Class B shares ­ about one-third of Google. The Silicon Valley venture capitalists Sequoia Capital and Kleiner Perkins Caufield & Byers, which together invested £25m in Google in 1999, each have almost 24 million Class B shares.

Last night's announcement was widely anticipated because it coincided with a deadline obliging Google to divulge basic financial data for the first time. A little-invoked law dating back to 1934 requires any US company with 500 shareholders and $10m in assets ­ a threshold Google reached last year ­ to disclose its assets to the Securities and Exchange Commission. According to the SEC filing, Google earned $105.6m on revenues of $962m in 2003. In the first quarter of 2004, it posted a profit of $64m, more than doubling its performance in the same period last year.

Google has added several new products as speculation of a flotation has mounted in recent months. They include an e-mail service, Gmail, and an online shopping arm called Froogle.

The tech sector has been starved of major IPOs since 2000, when AT&T floated its wireless phone subsidiary. Since then, Silicon Valley has seen the loss of 200,000 jobs and a tenfold increase in office vacancies.

Start your day with The Independent, sign up for daily news emails
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
SPONSORED FEATURES
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Sales Executive / Foreign Exchange Dealer - OTE £40,000+

£16000 - £40000 per annum: Recruitment Genius: A Foreign Exchange Dealer is re...

SThree: Experienced Recruitment Consultant

£20000 - £40000 per annum + OTE + Incentives + Benefits: SThree: Established f...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE 40/45k + INCENTIVES + BENEFITS: SThree: The su...

Recruitment Genius: Collections Agent

£14000 - £16000 per annum: Recruitment Genius: This company was established in...

Day In a Page

Refugee crisis: David Cameron lowered the flag for the dead king of Saudi Arabia - will he do the same honour for little Aylan Kurdi?

Cameron lowered the flag for the dead king of Saudi Arabia...

But will he do the same honour for little Aylan Kurdi, asks Robert Fisk
Our leaders lack courage in this refugee crisis. We are shamed by our European neighbours

Our leaders lack courage in this refugee crisis. We are shamed by our European neighbours

Humanity must be at the heart of politics, says Jeremy Corbyn
Joe Biden's 'tease tour': Could the US Vice-President be testing the water for a presidential run?

Joe Biden's 'tease tour'

Could the US Vice-President be testing the water for a presidential run?
Britain's 24-hour culture: With the 'leisured society' a distant dream we're working longer and less regular hours than ever

Britain's 24-hour culture

With the 'leisured society' a distant dream we're working longer and less regular hours than ever
Diplomacy board game: Treachery is the way to win - which makes it just like the real thing

The addictive nature of Diplomacy

Bullying, betrayal, aggression – it may be just a board game, but the family that plays Diplomacy may never look at each other in the same way again
Lady Chatterley's Lover: Racy underwear for fans of DH Lawrence's equally racy tome

Fashion: Ooh, Lady Chatterley!

Take inspiration from DH Lawrence's racy tome with equally racy underwear
8 best children's clocks

Tick-tock: 8 best children's clocks

Whether you’re teaching them to tell the time or putting the finishing touches to a nursery, there’s a ticker for that
Charlie Austin: Queens Park Rangers striker says ‘If the move is not right, I’m not going’

Charlie Austin: ‘If the move is not right, I’m not going’

After hitting 18 goals in the Premier League last season, the QPR striker was the great non-deal of transfer deadline day. But he says he'd preferred another shot at promotion
Isis profits from destruction of antiquities by selling relics to dealers - and then blowing up the buildings they come from to conceal the evidence of looting

How Isis profits from destruction of antiquities

Robert Fisk on the terrorist group's manipulation of the market to increase the price of artefacts
Labour leadership: Andy Burnham urges Jeremy Corbyn voters to think again in last-minute plea

'If we lose touch we’ll end up with two decades of the Tories'

In an exclusive interview, Andy Burnham urges Jeremy Corbyn voters to think again in last-minute plea
Tunisia fears its Arab Spring could be reversed as the new regime becomes as intolerant of dissent as its predecessor

The Arab Spring reversed

Tunisian protesters fear that a new law will whitewash corrupt businessmen and officials, but they are finding that the new regime is becoming as intolerant of dissent as its predecessor
King Arthur: Legendary figure was real and lived most of his life in Strathclyde, academic claims

Academic claims King Arthur was real - and reveals where he lived

Dr Andrew Breeze says the legendary figure did exist – but was a general, not a king
Who is Oliver Bonas and how has he captured middle-class hearts?

Who is Oliver Bonas?

It's the first high-street store to pay its staff the living wage, and it saw out the recession in style
Earth has 'lost more than half its trees' since humans first started cutting them down

Axe-wielding Man fells half the world’s trees – leaving us just 422 each

However, the number of trees may be eight times higher than previously thought
60 years of Scalextric: Model cars are now stuffed with as much tech as real ones

60 years of Scalextric

Model cars are now stuffed with as much tech as real ones