Zynga biggest tech flotation since Google

ZYNGA will top off a lively week for US flotations today as it begins trading on Nasdaq, after pricing its heavily-anticipated IPO at $10 per share, raising $1bn (£645m) and valuing the social gaming company at $8.9bn.

This is a large step down from the $2bn it wanted to raise and the valuation of $20bn that Zynga expected when it filed to go public in July.

In the biggest internet IPO since Google floated in 2004, Zynga put just 15 per cent of its shares up for public sale – a move that would not be allowed under stricter FTSE rules in the UK that would enforce a minimum free float of 25 per cent.

No pre-IPO investors sold shares in the float.

The company behind Farmville is one of 11 businesses to go public in the US this week, making it the busiest week for US flotations since November 2007.

Others include Jive Software, which priced its stock at $12 apiece when it floated on Tuesday, and Michael Kors Holding, which sold shares yesterday at $20. Both companies sold more shares than originally planned.

Today, the last day of trading before markets close until the New Year, wraps up a year which has seen 123 IPOs priced in the US, according to Renaissance Capital, of which 42 are in the technology sector.

By contrast, the UK has had a notably dry year for flotations as several companies have cancelled or postponed their intended IPOs, including vacuum technology group Edwards and online payments service Skrill.

Discount-deals service Groupon floated amid great expectations in early November but disappointed investors when its shares fell below their IPO price within three weeks, only returning to above $20 last week.

Eyes will now turn to Facebook, which is likely to go public next year and aims to raise $10bn, valuing the company at more than $100bn.

Zynga is said to have brought in $829m of revenue in the first three quarters of 2011, doubling the figure from the previous year.