By Ron Coates, 30 June 2004 10:00
NEWS Sir Richard Branson today confirmed the widespread rumours and announced that he would float Virgin Mobile, hopefully by the end of July, and give employees free shares.
In preparation for the move, he has re-stocked the board, bringing in Charles Gurassa, a veteran manager and, most recently, group ceo of Thomson Travel, as chairman. Sir Richard will become honorary president of the company after flotation.
Full details of the offer, which is being managed by bankers Morgan Stanley and JP Morgan & Chase, will be given next month. The IPO to gain a listing on the London Stock Exchange will be through a placing with institutional investors.
Employees with more than a year's service with the company will receive an unspecified number of free shares.
Branson said in a statement: "In less than five years Virgin Mobile has grown from scratch to acquire more than four million customers. I am very proud of what the team has achieved so far and am confident that, following the IPO, Virgin Mobile will go from strength to strength."
Three new non-executive directors have joined the 48 year-old Gurassa on the Virgin Mobile board: Caroline Marland, once MD of Guardian Newspapers; Rupert Gavin, CEO of BBC Worldwide and David Maloney ex-CFO of Le Meridien Hotels.
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1. anonymous
Maybe Sir Richard should take a look at the stock market in the U.S. An IPO for this small branch of Branson's empire could mean stability for Virgin in the the U.S. market, expendable capital to fund some past-due R&D, and most importantly, assets needed to acquire every component of the product. It's cheaper to be exposed to your own operation costs than be billed for someone else's. Why does virgin mobile contract every single aspect of Virgin Mobile USA? Audiovox, Kyocera, Sprint, ICT, and whoever else? Granted we are looking at a fairly new product/service for Virgin, (in the US,) but the market for prepaid cellular is old. Brand recognition is fuel for about half the fire, what happens when that brand is ruined? Are taxes/tariffs really that high? Has anyone thought about relocation of headquuarters to...um...how bout the Virgin Isles, governed by Sir Richard himself? Maybe the company could benefit if they eliminated the part of the political risk here?