Skype hoping to raise $100m

Skype plans to raise up to $100
million in an initial public offering, a move that would complete a dramatic
journey for the company that less than a year ago was a subsidiary of Ebay.

Shares will be listed on the Nasdaq
later this year according to a filing with the Securities and Exchange
Commission

Ebay sold Skype to a group of
investors last September after a series of contentious legal disputes between
Skype’s management, its founders and Ebay. In the end, Ebay received $1.9
billion for the company and retained a minority stake, just about breaking
after paying $2.6 billion for Skype in 2005.

The new owners included Silver Lake
Partners, the Canada Pension Plan Investment Board, and Andreessen Horowitz, a
venture firm led by Netscape founder Marc Andreessen.

Skype’s founders, Niklas Zennstrom
and Janus Friis, also joined the investment group after suing with claims that
their company, Joltid, still retained the key technology to power Skype.

The SEC filing revealed Skype paid
$343.8 million to settle this dispute. As part of the settlement, Skype also
invested $6 million in Rdio, a new social music service founded by Mr Zennstrom
and Mr Friis.

Skype, which last year became the
largest carrier of international calls, has continued to grow briskly. In the
year from 30 June 2009 to 30 June, 2010, the company grew in registered users
from 397 million to 560 million. During this time, users made 95 billion
minutes of voice and video calls.

“We believe the scale, global distribution
and growth of our user base provide us with powerful network effects, whereby
Skype becomes more valuable as more people use it, thereby creating an incentive
for existing users to encourage new users to join,” the company said in its
filing.

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