Vonage Holdings Corp., which provides residential phone services over the Internet, is planning an initial public offering to raise as much as $600 million, the Wall Street Journal reported on Thursday.
Citing a person familiar with the matter, the newspaper said Vonage had already raised more than $400 million in venture capital from firms that include Bain Capital, 3i Group Plc and Institutional Venture Partners.
There was no immediate comment from the Edison, New Jersey-based company, which declined comment to the Journal.
Vonage provides discounted local and long-distance phone services to about 800,000 households, making it the largest U.S. Internet-based phone company.
Customers with high-speed Internet connections plug an adaptor into a regular telephone and get a service that is largely identical to a standard phone service, except that it runs over their Internet connection.
Any IPO from Vonage, which has notched furious growth since it started offering a service in 2002, would be an important test of investors’ appetite for technology start-ups after many investors were burned by the meltdown of high-profile telecom and Internet stocks that started in 2000, the Journal said.
Vonage faces increasing competition from deep-pocketed rivals, including AT&T Corp. and many cable companies, which are quickly adding voice-over-Internet protocol, or VOIP, to their high-speed Internet offerings.
It also faces competition from a growing number of Internet giants, including Microsoft Corp.’s MSN unit and Yahoo Inc., which are adding voice components to instant messaging and gaming.
