In what has to be a case of the worst timing award, Visa is planning to launch an $18.76 billion IPO. When credit gets tight, go IPO:

NEW YORK (AP) — Visa Inc. said Monday its initial public offering could raise up to $19 billion - making it the largest in U.S. history - even though the credit card processor is entering the market at a difficult time.

The San Francisco-based credit card processor expects to see high demand for its stock, despite the housing-led credit squeeze that is threatening consumers’ spending and their ability to keep up with debt payments.

But Visa, like its public rival MasterCard Inc., is a card processor, not a lender, and has a strong presence in other countries where many people are just starting to use plastic instead of cash. And Visa is the largest U.S. card company by market share - its transactions, in number and dollar amount, in 2006 outpaced those at MasterCard and American Express Co.

Visa said in a Securities and Exchange Commission filing it will offer 406 million shares at $37 to $42 per share. There will be an option for underwriters to buy an extra 40.6 million shares to cover any excess demand.

Mastercard had a very successful IPO but currently is trending lower. The appetite for credit is diminishing and it will be interesting times for the IPO. If anything, Visa owns a large percentage of the US marketshare and this stock alone, should be an excellent litmus test for global consumer demand.

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Tags: credit cards

This entry was posted on Monday, February 25th, 2008 at 10:08 am and is filed under credit cards. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.