StorageNetworks more than triples in trading debut
StorageNetworks leads a pack of six technology companies that launch initial public offerings, the most to begin trading in a single day since the market decline in early April.
"We've clearly marked what the bottom is," David Menlow, president of IPO Financial, said of the recent improvement in the number and performance of new issues. But he added, "I'm not one that says the IPO market is back, because that connotes back to where it was, and we're far from that."
Data storage company StorageNetworks was the clear leader in today's crop, soaring 234 percent to close at $90.25 a share, after reaching as high as $100 during the day. The company raised $243 million yesterday from the sale of 9 million shares at $27 each, $18 million more than expected.
"They are in the right sectors, and they had an upward revision in their price, signifying to the market that this is a hot deal," Menlow said.
StorageNetworks operates more than 20 data centers in 11 U.S. metropolitan areas and one in London. Based on a $97 share price, the company has a market capitalization of $8.5 billion. The company trades under the ticker "STOR." Goldman Sachs handled the sale.
Exfo Electro-Optical Engineering was the other hot deal today. The Canadian company, which makes fiber-optic test and measurement equipment for telecommunications companies, jumped 69 percent to close at $43.88.
Exfo raised $182 million yesterday through the sale of 7 million shares at $26 each, $4 above the top of the $20 to $22 range set by Merrill Lynch. The company trades under the symbol "EXFO."
The four other tech companies that began trading today have performed as follows:
• Shares of Precise Software Solutions, a maker of software that evaluates network performance, closed at $24, a jump of 50 percent. Yesterday, the Israeli-based company raised $68 million through the sale of 4.25 million shares at $16 each, the top of the range set by underwriter Merrill Lynch. The company trades under the symbol "PRSE."
• Shares of Mobility Electronics, which makes remote connectivity technology linking a computer's central processing unit with its memory and other peripheral devices such as modems and disk drives, reached a high of $15.31 before closing at $13, a jump of 8 percent. The company raised $48 million through the sale of 4 million shares at $12 each, $1 above the pricing range set by underwriter Deutsche Banc Alex Brown. Mobility Electronics trades under the symbol "MOBE."
• Shares of Netease.com, a Beijing-based Internet portal that offers Chinese-language content and e-commerce services, jumped to $17.25 but later slipped to close at $12.13, down 22 percent from its offering price. The company raised $69.8 million after selling 4.5 million American depositary receipts at $15.50 each. Merrill Lynch handled the sale for Netease, which trades under the symbol "NTES."
• Mobile Telesystems, a cellular telephone company based in Russia, reached a high of $24.88 before falling to a closing price of $22.38, a gain of 4 percent. Earlier today, the company raised about $320 million through the sale of 15 million American depository receipts at $21.50 each. The company trades on the New York Stock Exchange under the symbol "MBT." Deutsche Banc Alex Brown handled the sale.