Wireless firm gains 50 percent in IPO
High-speed wireless equipment maker Vyyo gains 50 percent in its first day of trading, despite the poor performance of technology stocks this week.
Stock in Vyyo closed $6.75 higher at $20.25 as more than 3.4 million shares changed hands. Vyyo shares were among the largest gainers on the Nasdaq stock market today. Vyyo is valued at $682 million.
Although not a sky-rocketing initial public offering, the relative success of Vyyo's IPO when compared to the poor performance this week of technology stocks could serve as an indication of the vast interest in wireless and mobile Internet technologies.
The company makes "fixed wireless" equipment, the roof-top gear that allows businesses to make local phone calls and gain Internet access over wireless connections. Fixed wireless technologies have been heralded as a low-cost way to connect customers quickly with long-distance fiber-optic networks.
Because digging trenches to lay direct fiber-optic links is costly and time consuming, many communications service providers have turned to fixed wireless technologies instead. Some so-called third world nations with subpar telecommunications infrastructure also are installing fixed wireless systems.
WinStar Communications and Teligent are two service providers that have embraced fixed wireless technology, while Nextlink Communications, among others, also have used the systems in some instances. Many major communications companies, including MCI WorldCom and AT&T, are beginning to install similar systems.
Vyyo's gear competes against systems made by Wavtrace, Spike Technologies and many others.
The company offered 6.75 million shares at a price of $13.50 per share. Banc of America Securities served as the lead underwriter for the offering.