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Allaire tests public waters

The Web development toolmaker files to go public, expecting to raise $35.4 million from the offering.

2 min read
Web development toolmaker Allaire today filed to go public with the Securities and Exchange Commission.

The company expects to raise $35.4 million from its initial public offering, based on its filing fee. Allaire will trade under the "ALLR" symbol on the Nasdaq. The offering should be completed during the fourth calendar quarter, the company said.

In the SEC filing, Allaire reported a second-quarter net loss of $2.4 million, compared with a net loss of $1.3 million reported for the like period a year ago. Quarterly revenue rose to $4.6 million from $1.4 million last year.

Allaire's key product, Cold Fusion 3.1, is part of a growing breed of cross-platform and Java-based rapid application development tools known as application servers, which process data from many different sources and make it useable on the Internet. The breed is gaining popularity among many high-volume and e-commerce sites that depend heavily on back-end databases.

As competition in the application development server market heats up--based on demand for scaleable, Web-based enterprise applications--several smaller private companies have been acquired.

Last month, for example, Sun Microsystems bought NetDynamics, advancing the historically hardware-minded Sun's movement into the software business.

In addition, Netscape Communications in November bought application server start-up Kiva Software in an effort to expand its extranet strategy.

Other key application server players include Bluestone Software, GemStone Systems, and WebLogic. IBM and Sybase also have application server products in development.

Joseph Allaire, 28, founded Allaire in May 1995 and serves as the company's chairman. David Orfao, 39, is chief executive and president of the 3-year-old company. In addition to Cold Fusion, the Cambridge, Massachusetts-based company, which has137 employees, also offers HomeSite 3.0, an HTML editor.

The lead underwriter for Allaire's IPO is investment bank Credit Suisse First Boston. Dain Rauscher Wessels and NationsBanc Montgomery Securities will serve as co-underwriters for the offering.

Analysts say 1998 has been a relatively weak year for IPOs, but some Internet companies have bucked that trend. Webcasting company Broadcast.com had a spectacular offering in July, and earlier this week shares of online community GeoCities had a strong first day.