ANALYSTS have attacked the float of loss-making lastminute.com after its share price went into freefall.
The company floated on the London Stock Exchange at £3.80 per share but after an initial sharp rise, the share price had slumped back as Travel Weekly went to press.
Analysts said the float was designed to make multi-millionaires out of the founders, Brent Hoberman and Martha Lane Fox.
They are still on target to make a fortune but ordinary shareholders would actually make a loss if they traded at the current price, after paying costs.
In any case, they have been limited to 35 shares each and any profit for them will be tiny.
Lastminute.com, which sells travel, entertainment and gifts on its 18-month-old Web site, generated £409,000 in commission on the back of £4.3m worth of transactions last year. It made an operating loss of £10.6m last year.
“The business model is fundamentally flawed,” claimed one analyst. “What they are selling is loss-making stock from other companies. If that ever becomes profitable, those companies would start selling the stock themselves.”
Meanwhile, lastminute.com refused to comment on rumours it will buy Apollo Travel from Cosmos owner The Globus Group. Globus denied the rumour.
n see lastminute.com news, page 38
ANALYSTS have attacked the float of loss-making lastminute.com after its share price went into freefall.
The company floated on the London Stock Exchange at £3.80 per share but after an initial sharp rise, the share price had slumped back as Travel Weekly went to press.
Analysts said the float was designed to make multi-millionaires out of the founders, Brent Hoberman and Martha Lane Fox.
They are still on target to make a fortune but ordinary shareholders would actually make a loss if they traded at the current price, after paying costs.
In any case, they have been limited to 35 shares each and any profit for them will be tiny.
Lastminute.com, which sells travel, entertainment and gifts on its 18-month-old Web site, generated £409,000 in commission on the back of £4.3m worth of transactions last year. It made an operating loss of £10.6m last year.
“The business model is fundamentally flawed,” claimed one analyst. “What they are selling is loss-making stock from other companies. If that ever becomes profitable, those companies would start selling the stock themselves.”
Meanwhile, lastminute.com refused to comment on rumours it will buy Apollo Travel from Cosmos owner The Globus Group. Globus denied the rumour.
n see lastminute.com news, page 38