PayPal, the online person-to-person payment operator, has raised $70.2 million in an initital public offering that values the company at $777.4 million.
California-based PayPal claims over 10 million customer and $2.3 billion in transaction volumes for the nine months to end-September. The company has so far run up $264.7 million in losses since its inception in March 1999.
For its IPO, PayPal sold 5.4 million shares at $13 each, within the expected price range of $12 to $14 each, according to lead underwriter Salomon Smith Barney. By the close, Nasdaq-quoted PYPL has soared 60%, closing at $20.09.
PayPal has been mired in controversy since it signalled its intention to float last year. An initial IPO deadline set for last week was pushed back when the company received a patent infringement lawsuit from online authentication outfit CertCo. PayPal has also been the subject of numerous investigations by state banking regulators, culminating in Louisiana's request earlier this week that the service be shut down in the state while the company applied for a money transmission license.
In a revised SEC filing following the CertCo suit, PayPal also disclosed that a senior executive had viewed and commented on an advance copy of a glowing research note from Gartner. The note, issued just before PayPal's original IPO date, said that PayPal had established an unassailable lead over its nearest competitors and was set to become the leading e-cash standard for Internet payments.