Caldera delays IPO, hikes price

The Linux seller raises its initial public offering share price--meaning it could potentially raise $60 million instead of $45 million--but delays the offering.

Stephen Shankland principal writer
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Stephen Shankland
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Linux seller Caldera Systems raised its initial public offering share price but delayed the offering until Monday.

The company initially expected to sell 5 million shares at a price between $7 and $9 apiece, but today it raised the range to $10 to $12, the company said in a Securities and Exchange Commission filing.

Increasing the share price--which happened with Linux companies Red Hat, VA Linux Systems, Andover.Net and Cobalt Networks--is generally an indication of demand for the shares. It also means that Caldera could potentially raise $60 million instead of just $45 million.

On the stock market, Linux has been a sequel to Internet companies that went public and saw their stock soar. Linux companies generally aren't profitable, but as with Internet companies, the business plans essentially are to spend money now to win as strong a position as possible in a fast-growing and potentially critical market.

All eyes are watching Caldera Systems, though, to see how strong the Linux buzz is. Caldera had revenues of $553,000 and a net loss of $5.5 million for the quarter ending Jan. 31.

Linux is a clone of the venerable Unix operating system. It competes not only with Unix but also with several versions of Windows. Linux is cooperatively developed by a large collection of programmers, many of them volunteers looking for a little fame, but increasing numbers from companies with Linux products.

Caldera had been expected to set a final share price and become publicly traded this week, but the price-setting now is scheduled for Monday, a representative of lead underwriter Robertson Stephens said today.CNET's Linux Center

This week may not have been the most auspicious time to enter the market, given the volatility of the Nasdaq.

That schedule means the IPO likely will take place the same day Caldera releases a new version of its desktop edition of Linux, called eDesktop. The version is part of a two-tier strategy Caldera is taking with its software, aiming one version at servers and one at client computers.

In addition, Caldera is working on e-commerce software, called eBuilder, intended to make Caldera's eServer version more appealing to businesses creating Web sites.

Linux blowouts
First-day performance for selected Linux-related public offerings.
  IPO price First-day close Percent increase
Red Hat $14 $52 371 %
VA Linux $30 $239.25 697 %
Cobalt Networks $22 $105.60 482 %
Source: CNET research

Other Linux-related IPOs in the pipeline include Linuxcare, a purveyor of Linux services, consulting, training and certification, and Linuxone, a company about which analysts and Linux fans are wary.

All three plan to trade on the Nasdaq market. Caldera Systems expects to use the ticker symbol "CALD," Linuxcare expects "LCRE" and LinuxOne expects "LINX." Lead underwriters are Robertson Stephens, Credit Suisse First Boston and Capital West, respectively.

Other Linux IPOs expected this year include Lineo, TurboLinux, SuSE, Cybernet Systems and Atipa.