IPO Roundup: StorageNetworks soars in debut
StorageNetworks (Nasdaq: STOR) flew up 63 1/4 to 90 1/4, or 234 percent Friday after it priced 9 million common shares at $27 a piece. The company had raised its price range to $23-$25 a share from $17-$19.
"This category is set to expode," said Kenan Pollack of IPO Central, comparing the company to EMC (NYSE: EMC) and Veritas (Nasdaq: VRTS). "The Web is nothing more than a huge database, as it grows up, it needs more and more fail-safe storage."
As of March 31, the company had an accumulated deficit of $51.5 million. Net loss for the three months ended March 31 was $27.0 million, on revenue of $4.6 million, as compared to a loss of $1.2 million on revenue of 383 000 in the same period of 1999.
StorageNetworks depends on other companies to supply key components of its network infrastructure -- in it purchased greater than 90 percent of the disk storage arrays and related software that we use in the delivery of our managed data storage services from competitor EMC Corporation (NYSE: EMC).
The company has had a run-in with EMC recently -- it said it received a letter from EMC June 21 alleging that StorageNetworks misappropriated EMC's confidential information, violated an agreement not to hire EMC employees and misrepresented that EMC is an investor. The company warned that as a result of allegations recently made by EMC, it is possible that oits supply relationship with the company could be terminated.
StorageNetworks other competitors include Compaq (NYSE: CPQ) and StorageTek (NYSE: STK)
The deal's underwriters are Goldman Sachs, Credit Suisse First Boston, Thomas Weisel Partners and Wit SoundView.
The developer of products that enhance mobility for the computer industry, such as docking stations, had originally priced the shares in the $13 to $15 range, but lowered that estimate on June 6, through lead underwriter Deutsche Banc Alex Brown.
For the year ended December 31, the company lost $16.5 million on revenue of $13.9 million, as opposed to a loss of $18.0 million on revenue of $21.1 million in 1998.
The company's revenue was concentrated in sales to Targus, which totaled 16.2 percent of revenue for the year ended December 31, and 26.6 percent for the year ended December 31.
Mobility's current competitors include the internal design efforts of OEMs, which have traditional communication protocols that compete with its Split Bridge technology, a technology that extends the transmission link between a computer's main processor and peripherals.
The Canada-based company makes fiber-optic test, measurement and monitoring instruments for the telecommunications industry. EXFO's equipment is used mainly by optical network carriers, manufacturers and research laboratories to measure the physical characteristics of optical fiber, components, modules and network systems.
EXFO initially planned to offer 6 million subordinate voting shares in the IPO, which was led by Each subordinate voting share carries one vote; the company's multiple voting shares have 10 votes each.
The offering, underwritten by Merrill Lynch, will leave 38 million shares outstanding after the offering.
• Despite EMC flap, StorageNetworks set to soar >