Obi-Wan Ken-IPO? - CNN 05/18/05
Article from CNN - May 18, 2005
Star Wars fans would love to own a piece of Lucasfilm. But will Lucas ever take his Empire public?
NEW YORK (CNN/Money) – "An IPO? Hmmm. Raise money, you will."
That's what we imagine Jedi master Yoda would say to George Lucas if the two were having a conversation about taking Lucasfilm public.
Lucas, of course, is intensely private, so the odds of him subjecting his company to the intense scrutiny of Wall Street are probably about as likely as the despised Jar Jar Binks being named by movie fans as the most popular "Star Wars" character of all time.
Money probably isn't an issue either. Lucas already is worth $3 billion, according to Forbes magazine's latest annual ranking of the world's wealthiest people. And a company spokeswoman said that Lucasfilm has no plans for an IPO.
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So what could a public Lucasfilm be worth?
We did some quick back-of-the-envelope math to come up with an admittedly rough guess for a valuation. Pixar (Research) currently trades at about 20 times estimates for this year's sales while DreamWorks (Research) has a price-to-sales ratio of about 6.
If you split the difference, for a price/sales ratio of 13, and conservatively estimate another $1.05 billion in sales this year, you'd come up with a market value of around $13 billion. Not too shabby.