MasterCard sets IPO at $39 per share

NEW YORK -- MasterCard Corp.'s bid to become a public company got off to a shaky start yesterday after the world's number two credit card brand priced its stock below expectations, falling victim to volatile market conditions and concerns over its mounting legal problems.

The Purchase, N.Y.-based credit card association's stock will begin trading on the New York Stock Exchange today with an initial public offering price of $39 -- below the $40 to $43 range it originally expected.

The $2.39 billion offering will go down as one of the largest in two years, eclipsing the $1.7 billion raised when Google Inc. went public in 2004.

Weighing on the price were several factors, including recent erratic market conditions that led to a lackluster IPO from Vonage Holdings Corp. yesterday. The country's leading Internet phone provider's stock fell 13 percent below its offering price.

But what might end up being the main culprit is investor concern over MasterCard's legal and regulatory problems.

Architects of the IPO designed the flotation as a defensive move to shield it from a legal assault by retailers who feel fees are too high and continued regulatory concern over antitrust issues.

Some 61.52 million shares -- representing a 46 percent stake in the company -- will begin trading today under the symbol MA.