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Skype plans $100 million initial offering

By David Goldman, staff writer

NEW YORK (CNNMoney.com) -- Skype, the Internet video phone service, is planning a $100 million initial public offering, according to a regulatory filing Monday.

The company said it would offer American depositary shares, and the company's headquarters would remain in Luxembourg.

Since EBay (EBAY, Fortune 500) sold the company in September 2009, Skype has done very well. This year, the company has generated more than $406 million in sales, with 560 million registered users -- up 41% from a year earlier. Paying users, though just a fraction of the overall user base, jumped 23% to 8.1 million from 6.6 million a year ago.

Still, Skype said an IPO can help it do better. In the filing, the company said it had achieved "significant global scale and user growth," but "the penetration of our connected and paying users is low relative to our market opportunity."

Skype made headway when it landed a deal with Verizon Wireless (VZ, Fortune 500) this year. Mobile providers had been hesitant to allow the service to be used on their networks, since Skype users would not have to pay the wireless network for the voice minutes used. But wireless companies are quickly learning that data service can be a strong revenue driver too -- good news for services like Skype and rival Google (GOOG, Fortune 500) Voice, which are starting to be embraced.

EBay bought Skype for $2.6 billion in 2005, only to sell it four years later for $2.75 billion to an investment group led by private equity firm Silver Lake Partners. The online auction company had hoped to use Skype to facilitate communication between auction buyers and sellers, but that never quite happened.

EBay actually planned an IPO for Skype, but opted for the straight sale instead.

The match of Skype and EBay may not have panned out, but the company has been a consistent revenue driver for years. EBay estimated that the Internet phone company is on track to break $1 billion in revenue by 2011. To top of page

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