Entrust Technologies goes public
The vendor of certificate authority software announces an initial public offering of its common stock on the Nasdaq market.
In its first day as a public company, Entrust shares rose as much as 9 points to gain 25 percent, closing at 20.
The company began trading under the ticker "ENTU," and is offering 7.76 million shares of common stock at $16 per share, raising $124 million.
A spin-off from Northern Telecom, Entrust plans to use the funds as working capital, and other general corporate purposes, including product development.
The company develops, markets, and sells software that allow companies to establish secure electronic communications on the Internet, extranets, and intranets.
Digital certificates are similar to passports on the Internet. They are increasingly used for secure email, credit card purchases, and also for access to sensitive information or subscription-only services.
In January, VeriSign, which provides security services rather than software, hit the public market and soared, gaining more than 80 percent from its target price. Since it went public with a target price of $14 per share, the stock has climbed steadily and was trading today at 29.19.
Entrust's other competitors include GTE CyberTrust Solutions, Network Associates, and IBM. Large companies such as Netscape also have dabbled in Internet identity authentication.
Entrust has 398 employees and had sales of $11 million in the quarter ending in June and $5.8 million in the year-ago quarter. The company has 53.57 million shares outstanding. The company's managing underwriting group is led by Goldman Sachs and the comanagers are Donaldson Lufkin and NationsBanc Montgomery Securities.