Shares of Novatel Wireless Inc. (Nasdaq: NVTL), a provider of wireless data modems and software for handheld devices, were priced at $8 per share, below its estimated price range for trading Thursday.
The company will raise about $56 million by selling 7 million shares at the $8 per share, much less than under its initially expected price range of $10 to $12 a share.
The company's customers include wireless telecommunications operators such as Verizon Wireless and AT&T Wireless (NYSE: AWE), and wireless data content and service providers such as OmniSky Corporation, GoAmerica Communications Corp. (Nasdaq: GOAM) .
Its main customers are OmniSky (Nasdaq: SKYY), @Road, and Global Wireless Data, which accounted for 32.4 percent, 14.2 percent and 6.1 percent of revenue, respectively, for the nine months ended September 30.
Like most tech companies going public, Novatel's losses are high. For the 9 months ended September30, net loss was $30.27 million on revenue of $33.4 million as opposed to a loss of $9.53 million on revenue of $5.51 in the same period of 1999.
Current and potential competitors include wireless modem manufacturers, such as Sierra Wireless (Nasdaq: SWIR), Uniden, NextCell and Tellus; traditional wired modem manufacturers, such as 3Com (Nasdaq: COMS) and Xircom (Nasdaq: XIRC); Wireless device manufacturers, such as Handspring (Nasdaq: HAND), Palm (Nasdaq: PALM) and Research in Motion (Nasdaq: RIMM); and wireless handset manufacturers such as Ericsson (Nasdaq: ERICY), Motorola (NYSE: MOT) and Nokia (NYSE: NOK).
CS First Boston is the offering's lead underwriter. Co-Manager is USB Piper Jaffray. >