MercadoLibre Inc.'s upcoming initial public offering has been generating a lot of buzz lately, especially given its largest investor - eBay Inc. (NDAQ:EBAY). The Buenos Aires company owns and operates auction websites in several South American countries, including Argentina, Uruguay, Chile, Brazil, Columbia, Ecuador, Peru, Mexico and Venezuela. It is also launching portals in Costa Rica, the Dominican Republic and Panama.

MercadoLibre is expected to raise $270 million in its initial public offering. The company is expected to sell 2.6 million shares for between $16 and $18 each while stockholders will sell an additional 16 million shares. Interestingly, eBay does not plan to sell any of its 8.1 million share stake during the offering and will control around 19.7% of the company's outstanding shares. Since eBay didn't acquire the company outright, they clearly do not see a huge opportunity in Latin America yet enough to retain their stake and see where things go.

MercadoLibre reported 2006 net income of $1.1 million on revenues of $52.1 million. The first quarter of 2007 proved to be blockbuster for the company when it reported net income of $1 million on revenues of $16.5 million. Whether or not the company succeeds remains to be seen, but this is definitely a stock to watch as the situation unfolds!