LegalZoom withdraws IPO plans
Posted Jan 08, 2014 03:54 pm CST
Online legal help company LegalZoom won’t be offering public shares through an initial public offering because of an offer from a private investor.
A company backed by European private equity firm Permira will pay $200 million for a stake in LegalZoom, the Wall Street Journal Law Blog reports. The new buyer will become the largest stakeholder in LegalZoom.
LegalZoom chief executive John Suh told the Law Blog that LegalZoom had already put its IPO plans on hold in 2012 when it saw “public market conditions dramatically worsen.” Then last year the company added a new research and development center, and introduced several new products without a proven track record.
“Being public isn’t the best environment for that,” Suh told the publication. “It’s very difficult to guess what the renewal rate will be on a product one month after you launch it. … What the public really wants is a predictable stream of revenue and profits.”