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Web services firm shares double in IPO

Niku, a Web-based professional services firm, wins a warm reception from Wall Street and trades at more than double its target price.

Web-based professional services firm Niku today got a warm reception by Wall Street, trading at more than double its target price.

Shares of Niku soared $48.06, jumping nearly 230 percent, to $69.06 by the 1 p.m. PST close of regular trading. The company opened at $64 around 8:30 a.m. PST.

It offered 8 million shares at $24 per share, above its original target range of $20 to $22. Niku, along with making software, operates Internet portals that help companies manage human resources, billing and other professional services.

The company, which filed to go public last December, competes in a young market against Opus 360, eLance, and Monster Board.

The market for packaged Tune in to CNET TV's IPO Forecast supply-chain software is expected to grow from approximately $600 million last year to $12 billion by 2003, according to market research firm International Data Corp.

Last month, the company acquired Legal Anywhere, which provides Web services to law firms and legal departments, in a deal valued at $10 million. Niku said it expects the acquisition to help expand its business within the legal field.

The company, based in Redwood City, Calif., is led by Farzad Dibachi, a former Oracle senior vice president who left the database software maker in 1995 to start Diba, a designer of much-hyped Internet appliances that was later folded into Sun Microsystems.

Niku has sealed a few key clients that make up a large portion of its $2.9 million revenue base: Sybase accounted for approximately 22 percent during the nine months ended Oct. 31, USinternetworking accounted for 18 percent, and SalesLogix accounted for approximately 10 percent, the company said.

Goldman Sachs is managing the offering, which will be co-managed by Dain Rauscher Wessels, Thomas Weisel Partners and U.S. Bancorp Piper Jaffray.

The company is trading on the Nasdaq Stock Market under the ticker symbol "NIKU."