Onsale, Preview Travel plan offerings

After a sluggish spring in the technology offering arena, the fall has brought an onslaught of prospective offerings looking to raise working capital, and today two companies declared plans to raise funds in the public domain.

Online auctioneer Onsale (ONSL) filed today with the Securities and Exchange Commission to raise an additional $51.3 million in a secondary offering. And online travel service provider Preview Travel also chalked its name up on the upcoming IPO board.

Earlier this week, USWeb filed to go public as it looks to further fund its build-out of a nationwide franchise network of Web-development shops. RealNetworks, formerly called Progressive Networks, announced plans for an IPO last week, following on the heels of other companies that have jumped on the increasingly hot tech-IPO market of late, such as domain-name registrar Network Solutions.

Onsale said it will offer 2.3 million shares in a secondary offering, of which 1.7 million will be offered by the company, generating $51.3 million based on today's closing price of $30 a share. Existing shareholders will offer 590,700 shares, which will generate $17.7 million for those individuals. Onsale will not receive any capital from the shares offered by shareholders.

Following the secondary offering, the company will have a market value of $558.4 million, based on its 18.6 million shares outstanding.

Onsale had its initial offering in April. From an initial asking price of $6 per share, the stock has gained 600 percent to close today at $30 per share.

The company boasts in its filing that it has sold approximately $119 million of merchandise to more than 188,000 customer accounts from its first auction, in May 1995, through September 30.

The company said it has no specific plan for the net proceeds of the offering. It expects to use them for working capital to fund operations, including increased expenditures on sales and marketing; expansion of the company's merchandise inventory and accounts receivable; and for other general corporate purposes.

A portion of the proceeds also may be used to acquire or invest in complementary businesses or products, or to obtain the right to use complementary technologies.

The underwriters for Onsale's secondary offering include Nationsbanc Montgomery Securities, BT Alex. Brown, Hambrecht & Quist, and BancAmerica Robertson Stephens.

Also approaching the public realm is online travel agent Preview Travel, a provider of travel services by way of its ticketing service on America Online (AOL), its own Web site, and a cobranded travel Web site with Excite (XCIT).

Preview Travel filed a registration statement with the SEC today in an effort to raise $27.5 million through an IPO of 2.5 million shares of common stock at the proposed offering price of $11 per share. All shares are being offered by the company.

Following the offering, the company will have a market value of $127.8 million based on its 11.6 million shares outstanding.

For the quarter ending in June, the company recorded revenue of $3.2 million and a net loss of $1.54 million, or 17 cents a share. That compares with revenue of $3.3 million and a net loss of $650,000, or 8 cents a share, for the June quarter a year earlier.

The company said it expects that it will experience seasonality in its business, reflecting fluctuations in the travel industry, Internet and commercial online service usage, and advertising expenditures. Preview said travel bookings typically will increase during the second quarter in anticipation of summer travel and decline during the fourth quarter.

The company intends to use some of the proceeds to pay a portion of its obligations to AOL and Excite pursuant to the company's agreements with those companies to acquire redundant computer and communications systems.

In addition, the company may, when the opportunity arises, use a portion of the net proceeds to license and acquire content for its online sites, establish additional distribution channels, expand into international markets, and acquire or invest in complementary businesses, products, services, or technologies.

Hambrecht & Quist will lead manage the underwriting group with NationsBanc Montgomery Securities serving as comanager.