Virgin America share price shoots up more than 30pc on market debut

 
Sarah Spickernell
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Branson owns a 25 per cent stake in the company (Source: Getty)
Shares in Virgin America rose by over 30 per cent during its market debut on the Nasdaq stock exchange yesterday.
Initial share price for the low-cost carrier was $23, but in the middle of the day it peaked at $31.18, valuing the company at approximately $1.35bn (£861m).
13.3m shares had been sold by the end of the first day of trading, finishing 30.4 per cent higher in value and raising a total of $307m.
Josef Schuster, founder of IPO investment firm IPOX Schuster, said: "I think it's a buy-and-hold story."
The airline, which offers mainly long haul flights within the US, is an off-shoot of Richard Branson's London-based Virgin Group.
The billionaire entrepreneur is one of Virgin America's biggest backers, owning a 24.8 per cent stake in the company. The other major backer is the hedge fund Cyrus Captial Partners, which owns 32.8 per cent.
The valuation follows on from an overall positive performance by the airline – in 2013, it reported profits of $10.2m (£6.5m) on revenue of $1.42bn. This was the airline's first profitable year since it started flying in 2007.

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