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China.com soars up 233 percent in IPO

China.com Inc. closed up 46 5/8, or 233 percent, to 66 5/8 Tuesday in its initial public offering. After pricing its 4.2 million-share offering at $20, the stock moved as high as 68 in early trading.
Written by Larry Dignan, Contributor

Lehman Brothers, the lead underwriter, bumped up the price range Monday from $14 to $16 to $17 to $19. By the time the stock hit the trading floor, it was priced at $20.

The IPO is expected to be strong as investors look at two growing markets -- China and the Internet -- and concluding that the company will be the next America Online or StarMedia, the Latin American portal. "This will be hot like StarMedia," said Randall Roth, an analyst with Renaissance Capital in the U.S., who noted China.com's easy Web address and first mover advantage. The company will use its IPO riches for marketing and capital expenditures.

For 1998, China.com had sales of $3.45m (£2.10m) and a loss of $11m.

Some of the Internet's top players hold stakes in the company -- AOL, Sun Microsystems Inc., and 24/7 Media Inc. AOL holds a 10 percent stake. 24/7's is about 9.5 percent. New World Infrastructure Ltd. owns 20 percent.

China.com operates four major Internet Web sites that offer Chinese and English language content and electronic mail.

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