THE VISA IPO. Aha! The Real Story Comes To Light! When I heard of the upcoming initial public offering (IPO) of Visa a couple weeks back, I was shocked and wrote about it (Feb. 27th) wondering out loud why anyone would buy it. I did find the argument underpinning this “largest US IPO ever” of 16 million shares (right in the face of a bear market). Besides the fees being juicy and few other IPOs to work on, the investment rationale is US consumers are using credit for more of their purchases, over time anyway, while MasterCard’s IPO was a big past winner. Still I warned against buying V (nice symbol). Then I read another article on www.MarketWatch.com last Friday which clarified the picture further. Seems like banks own a ton of Visa and with their financial travails they can obviously use the proceeds. JP Morgan will get over a $1 billion, Bank of America a half a billion, Citigroup, National City, etc., all together the banks get over $10 billion of the roughly $16 billion deal. After putting some money aside in escrow for litigation settlements, Visa itself gets about $3 billion. No wonder the deal is so big. Schwartz View: Summing up I see MAD MONEY’s Cramer recommending getting some saying the pricing is good. I have to agree, only IF you can buy some at the offering price (which most investors can’t). To market this deal, the underwriters JP Morgan and Goldman Sachs must be under pricing it so as to give buyers on the offering a chance to flip it. Otherwise who would buy it in today’s market?