Visa IPO

Abstract
Visa IPO is in the pipeline and is a much awaited IPO. Since Visa is a prominent player in the market, owning 60% of the stake, its IPO is being increasingly looked upon as an effective investment instrument. Few experts are also expressing their doubt whether the Visa IPO will be a success due to the prevailing market conditions.
The upheavals in the capital market is an indication that not all is well in the economy of the country. Experts state that if there is a long phase of bearish economy, this inadvertently impacts the economy in an adverse manner. In fact, the initial public offerings are the true tale teller of the economic status.

Lately, there were reports that the credit card stalwart Visa, Inc has planned to release its initial public offerings or IPOs worth USD$10 billion dollars. To this effect, the company has also taken permission from the SEC or Securities And Exchange Commission.

Visa IPO is slated to be one of the largest IPOs after AT&T Wireless IPO Issue size of USD$10.62 billion in the year 2000. The company has also decided to undergo restructuring. Visa has a 60% market share. However, it still has not announced details about the Issue size, price of the shares or the probable date of its going public.
As of 2007 November, the company had said that within a span of a year or 18 months, Visa IPO may be launched.
Utilization of the Visa IPO proceeds:
The capital raised from the IPO is assumed to help Visa “form alliances” and also reduce its dependence on the various bank owners. However, speculations are ripe and due to the recession prevailing in the United States of America, how much successful the much awaited IPO will be is in question. With the help of this capital, the company can also opt for new investment opportunities, enhance its payment procedures. The global scenario of the stock markets are equally bad.
The beneficiaries of the Visa IPO:

The Visa IPO deal will prove to be beneficial for the following financial institutions:
Wells Fargo
Bank of America
JP Morgan
A similar instance was seen after the success of the IPO floated by MasterCard.

The beneficiaries were:
JP Morgan
Citigroup
Note:
In the year 2006, MasterCard became public when it launched an IPO of USD$2.4 billion. Since then MasterCard shares have increased manifold.

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Last Updated on : 30th July 2013