Visa Inc. submitted another amendment to their IPO filing this morning. The IPO could now be the largest in history, with a proposed maximum aggregate amount in securities listed as more than $18.7 Billion. 

The offering consists of 406 million shares of class A common stock with an expected initial public offering price of $37.00 and $42.00 per share.  This pricing range has to get more finite before it is a done deal and before any determinations can be made about the market chatter ahead of the IPO. 

Visa has applied to trade on the New York Stock Exchange under the symbol, "V." Be advised, that used to be the ticker for Vivendi.  Lead underwriters include JPMorgan and Goldman Sachs.  The syndicate is actually huge.  Others listed are Banc of America, Citigroup, HSBC, Merrill lynch, UBS, Wachovia, CIBC, Daiwa Securities, Mitsubishi UFJ Securities, Piper Jaffray, RBC Capital, SunTrust Robinson Humphrey, and Wells Fargo.

The world’s largest retail electronic payments network generated unaudited pro forma operating revenues of $5.2 billion and $3.9 billion for the fiscal years ended September 30, 2007 and 2006, respectively. Global card purchase transactions are forecast to grow at an 11% CAGR from 2006 to 2012, based on The Nilson Report.

We would note that Discover Financial Services (NYSE: DFS) has been public almost 8-months, and it is down 50% from highs.  American Express (NYSE: AXP) has seen shares lose one-third of their value and the malaise in the rest of the sector is widely known. Many have ventured that the success of the MasterCard (NYSE: MA) IPO will be a hard one to duplicate, with its shares being down 10% from highs and still a double over the last year.  Because Visa has essentially new team and was an amalgamation after the success was seen at Mastercard, that belief may continue regardless of the IPO.  As this gets closer with more finite pricing data we will make more calls of that "consensus." 

Regardless of any pre-IPO data and any bias in the sector still being quite negative, it is hard to imagine that money managers and investors would turn away from this one and not try to get shares.  Many may turn in orders just in hopes that they are getting shares on the cheap because of the woes in the entire financial services sector.  Stay tuned.

Jon C. Ogg
February 25, 2008

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