PlanetOut to offer IPO

0 Comments | Oakland Tribune, May 1, 2004 | by Lisa Leff, Associated Press

SAN FRANCISCO -- PlanetOut Inc., an online media company that operates Internet sites geared to gay and lesbian audiences, announced Thursday that it plans to go public in the near future.

In documents filed with Securities and Exchange Commission, the San Francisco-based company said it hopes to raise up to $75 million with an initial public offering of stock that would trade on the Nasdaq Stock Market under the symbol "LGBT," an acronym for lesbian, gay, bisexual and transgender.

PlanetOut, which operates Gay.com and three other gay- and lesbian- oriented Web sites that have more than 3.3 million active users worldwide, has been somewhat of a success story amid the ruins wrought by the bursting of the dot-com bubble four years ago.

Still small by corporate standards, it had revenues last year of $19 million, compared to the $962 million brought in by Internet search engine Google, which revealed plans for its own stock market debut Thursday.

But the company has increasingly moved toward profitability, ending 2003 with a loss of $752,000 and its first profitable quarters compared to the $7.9 million worth of red ink it spilled the year before.

Rising advertising revenue and income from its subscription-based personals service gave PlanetOut record fourth quarter revenue.

Besides personal ads and chat rooms, PlanetOut's sites offer news, shopping, and advice on topics ranging from health and relationships to travel and parenting.

PlanetOut did not specify what its stock would sell for, but said the IPO would begin "as soon as practicable" after its plans receive regulatory approval. The company said it will offer all of its shares in the IPO, which will be managed by UBS Investment Bank and WR Hambrecht.

In its IPO filing, PlanetOut said the proceeds from its stock sales would be used for general corporate expenses and possibly for the acquisition of additional businesses or products.

SEC rules preclude PlanetOut executives from commenting on the company and its IPO for at least 30 days. In an interview with The Associated Press last year, Chief Executive Officer Lowell Selvin said that when he was seeking investors at the height of the dot-com boom, some were reluctant to invest in a gay-oriented company.

Since then, PlanetOut has grown into what Selvin described as the world's largest media company serving the gay and lesbian market.

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On the Net:

www.planetoutpartners.com