Freeserve May Be Worth Billions at IPO

Freeserve, the U.K.’s largest Internet service provider, will be valued at as much as $2.3 billion when a fifth of the company is sold on the stock market later this month, according to a person familiar with the sale. That will make it Europe’s largest publicly traded Internet company less than a year after it was created by Dixons Group, Britain’s largest electronics products retailer. Freeserve said a price will be set July 26.

The boom in Internet stocks that has swept the U.S. is just beginning to reach Europe. Freeserve has been likened to America Online and Yahoo. It offers a directory of online services, although it doesn’t charge subscription fees. It gets a portion of its revenue from the cost of phone calls and much of the remainder from advertising.