Agilent tops next week's IPO calendar

Earlier this week, Microsoft spun off its online travel agency, Expedia, which priced its initial public offering at $14. The stock jumped 281.7 percent on its first day of trading, placing it among the top 20 performers based on first-day gains.

For next week, IPO watchers are predicting that HP's powerful presence in the tech industry will yield a strong showing for Agilent.

Agilent, which makes test and measurement equipment used by the telecommunications and life sciences industries, could raise up to $1.25 billion based on the high end of its pricing range. The net proceeds, however, will be given to HP in the form of a dividend instead of going to Agilent's coffers.

The company set a price range of $19 to $22 a share and plans to float a hefty 57 million shares, about one-eighth the total number in the company. The company expects to price Thursday and begin trading on the New York Stock Exchange Friday under the ticker "A." Morgan Stanley is the lead underwriter.

"It's a big company coming from a name everyone knows," said Ken Flemming, an IPO analyst with Renaissance Capital's IPO-Fund. "Agilent is also in some high-growth areas like communications and health care."

HP will hold an 87 percent stake in the company after the IPO. The tech giant said it plans to distribute its Agilent shares to HP shareholders by mid-2000, although those plans may be subject to change.

HP has not yet determined the ratio in which it plans to distribute the shares, a company representative said. Agilent plans to have 437 million shares outstanding after the IPO.

During the nine months ended July 31, Agilent saw its revenues slightly decline to $5.88 billion, compared with $5.96 billion a year ago. Net income, however, increased to $366 million, compared with $308 million the previous year.

Other IPOs expected next week include CacheFlow and the foreign companies i-Cable Communications and Terra Networks.

CacheFlow, which markets appliances designed to accelerate the delivery of information of the Internet, is in a hot market, said Jeff Hirschkorn, senior analyst for IPO.com.

"They're in Internet services, which has dominated the market this year," he said, pointing to F5 Networks' successful IPO. F5, a maker of products that help manage Web site traffic, priced at $10 a share and today is trading around $130--making it one of the best-performing IPOs this year.

CacheFlow plans to float 5 million shares and currently has a range of $11 to $13 a share. The company plans to raise up to $65 million.

CacheFlow is expected to price Thursday and begin trading Friday under the ticker "CFLO." Morgan Stanley is the lead underwriter.

"I can see them gaining 70 to 80 percent or more on their first day," Hirschkorn said.

The company, which counts Delta Airlines and Xerox among its 100 customers, generated $3.6 million in revenues for the three-month period ending July 31, compared with $809,000 for the same period a year ago. CacheFlow posted a loss of $6.6 million in the period, compared with a loss of $2.3 million a year earlier.

i-Cable also is expected to gain investor attention. The company, owned by Wharf Communications, is the only cable company in Hong Kong, Hirschkorn noted.

"Cable is hot, and investors are going for international deals," he said.

The company is expected to raise up to $218.7 million based on a pricing range of $22 to $27 a share and the 8.1 million shares being sold. i-Cable, which is underwritten by Merrill Lynch, is expected to price in the middle of the week and to trade under the ticker "ICAB."

Terra Networks also is gearing up for a strong IPO performance.

The company, which operates Internet service providers in Spain and Internet access and portal sites in Brazil and Mexico, plans to enter the U.S. market next year. Terra has 860,000 subscribers and is owned by Spain's Telefonica.

"I think their market opportunity is great," said Peony Kao, an analyst with Renaissance Capital. "First, they have access to their parent company's customers, and secondly, Latin America is a huge area for growth."

The company reported revenues for the six months ending June 30 of $28.8 million; its net loss for the period was $84.3 million.

Terra plans to raise up to $277.4 million based on the high end of its $10.66 to $12.44 pricing range and the 22.3 million shares being offered. The company plans to price Monday and begin trading Tuesday under the ticker "TRRA." Goldman Sachs is the lead underwriter.