IPO shares reprised: one up, one down

Two initial public offerings scheduled to begin trading revise their price ranges in opposite directions.

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Two initial public offerings scheduled to begin trading tomorrow have revised their price ranges in opposite directions.

Oplink Communications, which sells optical-networking components, upped its range to $16 to $18. The price hike is the second for the shares, signaling strong demand by investors and possibly a sharp rise in first-day trading. Last week, Oplink increased its range to $14 to $16 from $10 to $12.

Paul Bard, an analyst with Renaissance Capital IPO Plus Aftermarket Fund, said the revised pricing reflects investor appetite for sellers of optical components.

"This could be one of the top-performing IPOs this week, certainly. Investors could see the IPO double or even triple," said Bard. "There's an extreme demand for optical component companies, because there's such a small supply of those companies out there."

Lucent Technologies, Nortel Networks, Sycamore Networks and Corvis use optical components in building networks. While some of these companies manufacture their own components, many also need to purchase them.

San Jose, Calif.-based Oplink plans to sell 13.7 million shares, at the revised range of $16 to $18, possibly raising $246 million. The shares will trade on the Nasdaq under the ticker symbol "OPLK." Robertson Stephens is managing the sale.

Tomorrow's other high-profile IPO, Asia Global Crossing, has revised the terms of its offering in the opposite direction. This company, which is building a fiber-optic network across Asia, revised its price range to $9 to $11, from $14 to $16, and cut the number of shares it will offer to 53 million from 62.2 million.

Hamilton, Bermuda-based Asia Global Crossing is a joint venture between Global Crossing, Microsoft and Softbank. Renaissance Capital's Bard says the downward revision is not surprising given the enormous size of the offering.

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IPO forecast
"You probably won't see as strong a performance out of that offering because there are so many shares. But in addition to that, investors are hesitant to invest in companies that have to spend a lot of money to complete their networks," Bard said.

Asia Global Crossing is expected to begin trading tomorrow on the Nasdaq under the ticker symbol "AGCX." Goldman Sachs, Salomon Smith Barney and Merrill Lynch are handling the sale.