QXL in talks with ‘prospective buyers’
Breaking news from Breaking Views
QXL, Europe's biggest auction site, is in talks with prospective "strategic investors", according to financial commentary outfit Breaking Views. And Lycos Europe is named as the most likely buyer.
Noting the volatility of QXL's share price, Breaking Views columnist Edward Chancellor says the company has become a "daytrader's plaything". The share price has been depressed shortselling ahead of a massive influx of QXL shares next month, with the end of the lock up period for pre-IPO investors and a new share issue to pay for the acquisition of German rival Ricardo.
QXL's market cap is now £50 million, compared with a value of £3 billion at the height of the dotcom bubble. And the money will run out before the it reaches profitability, Chancellor argues.
The company's current cash burn rate, reduced but still
£15 million per month, will see it through for another 12 months only, he says. ®
You can read Chancellor's analysis in full at Breaking Views.