Shares in KPMG Consulting Inc rose $5.62-1/2 (€6.03) to $23.62-1/2 just after they were floated at an initial public offer price of $18 on the US market yesterday. The Nasdaq launch price was at the top of the pre-flotation range of $16 to $18 per share. The shares closed at $23.50, up $5.50 on the day.
Some 45 partners at the KPMG accounting practice in the State will share paper profits of about £30 million (€38 million). But they will not be able to realise their profits for six months due to a lock-in clause.
KPMG Consulting announced an initial public offering of 112,482,000 shares at $18 each, raising a total of $2.02 billion for the company and the selling shareholders.
Some 31,826,583 shares were offered by KPMG Consulting and 80,655,417 shares were offered by KPMG LLP, representing partners in the accountancy practices in the Americas and the Republic.
KPMG is the first of the Big Five accounting partnerships to float off its consulting operations on the stock market. The consulting group reported annual revenue of just over $2 billion in 2000. At an $18 share price, the company had a market capitalisation of $2.7 billion. The rise in the share price to $23.50 increased the value of the company to just over $3.5 billion. or just under 1.5 times historic revenue.
