Salesforce.com readies for IPO launch
Published: 18 Jun 2004 09:25 BST
Salesforce.com is set to launch its long-anticipated initial public offering, an event that has been marked with controversy and two false starts since it filed its regulatory paperwork six months ago.
The IPO of the customer relationship management (CRM) software maker is attracting attention despite sitting in the shadow of Google's pending IPO. Salesforce.com is planning to raise as much as $85m, based on the high end of its $7.50 to $8.50 price range.
The company is expected to set a specific per share price for its IPO on Tuesday and begin trading the following day on the New York Stock Exchange under the ticker "CRM", according to the company's bankers.
Salesforce.com may have been better off if its IPO hadn't received so much attention.
Last month, the company was set to launch its IPO but delayed it because of Securities and Exchange Commission voiced concerns over a profile of its founder that appeared in The New York Times.
In April, Salesforce encountered its first IPO delay, after the SEC regulators wanted the company to realign its sales commission accounting methods. The regulators wanted Salesforce.com to apply its current accounting method to its historical financial information surrounding its sales commissions, in order to achieve an apples-to-apples comparison for prospective investors.
The company's pending public offering and that of Google are expected to rekindle the market for high-tech IPOs. The Salesforce.com IPO filing came on the same day that Linux software maker Lindows.com announced its own IPO plans, and as other high-tech companies had their IPOs waiting in the wings.
Salesforce plans to use its IPO proceeds for capital expenditures. The company is seen as a test of a new business model that could shake up the software industry. The company is the poster child for subscription-based software, a model that's gaining popularity among corporate buyers. Analysts predict that the success of Salesforce.com and others like it could pose a challenge to old-guard software companies, including SAP, Siebel Systems, PeopleSoft and Oracle.
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