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T-Online makes solid debut
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April 17, 2000: 7:28 a.m. ET
Offering of Europe's largest ISP attracts buyers amid market tremors
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LONDON (CNNfn) - Europe's largest Internet offering hit the stock market Monday and emerged relatively unscathed from the turmoil afflicting other technology stocks.
T-Online, a subsidiary of Deutsche Telekom (FDTE), priced its issue at  27 per share over the weekend, valuing the company at 30 billion ($28.8 billion). In early trade Monday T-Online stock gained 20 percent to 32.40, as investors welcomed the firm's decision to sell shares for a price at the bottom end of the previously indicated 26-32 range. 
Telekom said the issue was heavily oversubscribed, with both individual and institutional investors demanding more than 10 times the numbers of shares on offer, indicating a healthy appetite among investors despite the pummeling received by other tech stocks in Europe and the United States.
T-Online is Europe's largest Internet service provider, with about 5.3 million subscribers. Telekom sold 100 million shares, 9 percent of the company, raising 2.7 billion.
T-Online wants a separate listing from Deutsche Telekom to pursue more acquisitions. An IPO would give the company a currency with which to do deals. The firm has already bought a 25 percent stake in France's second-largest ISP, Club Internet, and has holdings in several other online companies.
In the summer the German government will sell a third slice of Deutsche Telekom's equity to investors as it continues to reduce its holding in the company, now at two thirds. T Mobil, Telekom's cellular subsidiary, is slated for an IPO in the fall.
Today's IPO was seen as a key test of investor appetite for Internet companies.
"T-Online is very important, we'll see how that does," a spokeswoman for United Pan-Europe Communications, a Dutch cable operator that plans to list shares in its Chello high-speed ISP unit in the next two months, told CNNfn. She said Chello's plans for an IPO remain on track at the moment. 
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