The Kayak board has quietly authorized the company to increase its number of common shares by 5 million to 50 million, a maneuver that doesn't ensure an IPO, but would be a prerequisite for one.
Amendment 3.8, which alters Kayak's certificate of incorporation, was published along with Kayak's 9th update since November 2010 to its IPO documents.
Giving the board the authority to increase Kayak's number of outstanding shares may be significant because Kayak has indicated it would do so "immediately prior" to executing an IPO.
Specifically, Kayak's 9th amended S1/A filing states: "... immediately prior to the consummation of this offering, we will increase our total authorized number of shares of capital stock, and amend our certification of incorporation and By-Laws as described below."
Kayak hasn't actually issued the new shares, but authorizing the board to do so puts the wheels in motion should Kayak decide to price its offering, kick off a roadshow and try to go public.
Kayak's options for raising capital are an open question given the fact that it has remained stuck at the IPO starting gate since it announced its intentions in November 2010 to become a publicly traded company.
In the interim, the IPO market dried up and Google acquired ITA Software, which powers 61% of Kayak's airfare query results.
The Kayak-ITA relationship still looms large and hangs over Kayak's IPO prospects.
Although Kayak's contract with ITA Software expires December 31, 2013, there is little reason to believe that the two parties wouldn't be able come to terms on a new contract.
However, whether Kayak would get access to the latest updates to ITA's QPX airfare shopping and pricing system in light of the launch of the ITA-powered Google Flight Search remains to be seen.
Kayak states "that alternative faring engine solutions currently do not provide the level of comprehensiveness and accuracy that ITA's software provides."
Meanwhile, there are several schools of thought on whether the recent Yelp IPO may have boosted Kayak's prospects for its own IPO.
Some observers argue that each company's IPO try is judged on its own merits while others concede that point, but hold that Yelp's success improves Kayak's prospects.
Yelp raised some $107.3 million in its IPO earlier this month despite the fact that it had a net loss of $16.8 million in 2011, and similarly operated in the red in 2009 and 2010, as well.
In contrast, Kayak has been profitable since 2008 and has executed top line growth, although a good chunk of it has come from increased marketing and international acquisitions.
But, as one financial analyst put it: "If Yelp can do it, then why not Kayak?"