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Breakaway Solutions triples on first day

Shares of Breakaway Solutions, an Internet services firm that hosts business applications for customers, more than triples after the company's initial public offering today.

    Shares of Breakaway Solutions, an Internet services firm that hosts business applications for customers, more than tripled after the company's initial public offering today.

    The company's stock closed up 28.44 points, or 203 percent, to 42.44 on the Nasdaq.

    Boston-based Breakaway opened at $61 per share under the ticker symbol "BWAY." The company, which targets companies in the small to midsized market, raised its initial public offering (IPO) of 3 million shares late yesterday to $14 per share from the expected range of $10 to $12 a share. The increase in its IPO price is expected to raise $42 million, up from $33 million.

    Breakaway said it has granted underwriters Morgan Stanley, Lehman Brothers, and Deutsche Banc Alex. Brown the right to buy up to an additional 450,000 shares of its common stock to cover over-allotments.

    In addition to offering Web hosting services, the company also provides business strategy, implements customer relationship management (CRM) applications, and outsources senior level executives to smaller firms.

    Breakaway competes with USinternetworking and Corio, other application service providers (ASPs) that also target the midmarket. Outsourcing advocates have argued that hosting is a sensible route for smaller businesses that want to use business software but can't afford to hire staff to manage it. The ASP market is expected to grow to $2 billion by 2003, according to market research firm International Data Corporation.

    Less than a year old, Breakaway, which is led by former executive and cofounder of Cambridge Technology Partners Gordon Brooks, also has offices in Philadelphia; Dallas; San Mateo, California; Santa Clara, California; and Orlando, Florida. The company said it employs roughly 289 workers to date.