Limelight Networks Should IPO This Week: Will Be Valued Near A Billion Dollars

Limelight Networks is scheduled to price their shares on or about this Thursday and could be trading as early as this Friday. While their prospectus says shares should price between $10-$12, my guess is that they could be priced higher than that simply based on how hot the content delivery market is.

Personally, I think anytime a company in our space goes public it's good for the entire industry as it brings added exposure to the world of online video. It also allows us to see the real numbers behind the business; although in Limelight's case, they are one of the few who have been showing their numbers for awhile even before they were raising money.

Based on their S-1 filing of 78.3 million shares out, at $11 a share that's a market cap of $861 million, minus cash of $127 million plus debt of $20.6 million, that gives them an enterprise value of about $750 million. And that's with it pricing at $11 a share. So if it prices higher, and goes up at all upon trading, they will be over the billion dollar mark. That would be a multiple of about 15x revenue.

UPDATE: On many news websites, articles are quoting Jim Cramer as having said on his TV show that MTV and Akamai are suing Limelight Networks. Limelight Networks is NOT being sued by MTV. As their prospectus clearly states, Akamai and MIT (Massachusetts Institute of Technology) are in litigation with Limelight, not MTV.

Comments

[Mark Alan Effinger]

Limelight is a true performer. I emphatically agree that a price above $11 is very realistic... I'd be surprised if they don't fetch $25 per share by the end of the first week of trading.

Companies like Limelight should be congratulated for building profitable, fundamentally solid enterprises in web delivery.

We wish them the best.
Mark Alan Effinger
http://www.RichContent.tv