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March 15, 2007
BigBand IPO Shares Up Sharply
Associated Press
Shares of BigBand Networks Inc. leaped Thursday in first-day trading for the provider of equipment for cable-television companies.
The Redwood City, Calif.-based company's stock rose $4, or 30.8 percent, to close Thursday at $17 on the Nasdaq Stock Market.
The initial public offering price was $13 for each of the 10.7 million shares, above the expected price range of $10 to $12 set by underwriters Morgan Stanley and Merrill Lynch & Co.
With Thursday's strong trading debut, BigBand defied jittery markets and a mixed reception to recent technology IPOs.
BigBand is the eighth technology stock to go public so far this year, taking the combined value of the deals in the technology sector to more than $1.2 billion, based on data from Dealogic
BigBand's stock-market debut comes a week after the high-profile IPO of wireless-broadband company Clearwire Corp. disappointed investors, closing below its IPO price on its first day of trading on the Nasdaq. In contrast, security-software company Sourcefire Inc. was more warmly received, closing up 4 percent.
"Given the recent market performance in virtually all sectors, BigBand Networks' opening was particularly impressive," said Scott Sweet, managing director of IPOBoutique.com, an IPO research service near Tampa.
"With an increased pricing above the original filing range, it is quite apparent that the placement of the stock was particularly well-done in this challenging environment."
Proceeds of the IPO will be used to repay debt, for working capital and capital expenditures.
BigBand helps cable operators and telephone companies increase the capacity on their customer lines, creating room for video, voice and data services. It also has an application that inserts advertising into broadcasts.
The company has more than 100 customers globally, including some of the biggest cable and phone companies in the U.S.: Cablevision Systems Corp., Charter Communications Inc., Comcast Corp., Cox, Time Warner Cable Inc. and Verizon Communications Inc.
Sales to BigBand's five largest customers accounted for about 90 percent of net revenue for the December quarter 2006 and 79 percent for the full year.
BigBand's IPO comes after a significant growth spurt. Its revenue soared 80 percent to $176.6 million last year.
BigBand also moved into the black for the first time last year, reporting an $8.9 million profit compared with a $25.5 million loss in 2005.
At the end of 2006, BigBand had an accumulated deficit of $111.3 million.
Venture-capital firm Redpoint Ventures owns 22.5 percent of BigBand after the offering, compared with 25.8 percent previously. It didn't sell any shares in the offering.
Time Warner Inc. has reduced its stake in BigBand from 4.1 percent to 2.9 percent after selling 360,140 shares.
BigBand IPO Shares Up Sharply
Associated Press
Shares of BigBand Networks Inc. leaped Thursday in first-day trading for the provider of equipment for cable-television companies.
The Redwood City, Calif.-based company's stock rose $4, or 30.8 percent, to close Thursday at $17 on the Nasdaq Stock Market.
The initial public offering price was $13 for each of the 10.7 million shares, above the expected price range of $10 to $12 set by underwriters Morgan Stanley and Merrill Lynch & Co.
With Thursday's strong trading debut, BigBand defied jittery markets and a mixed reception to recent technology IPOs.
BigBand is the eighth technology stock to go public so far this year, taking the combined value of the deals in the technology sector to more than $1.2 billion, based on data from Dealogic
BigBand's stock-market debut comes a week after the high-profile IPO of wireless-broadband company Clearwire Corp. disappointed investors, closing below its IPO price on its first day of trading on the Nasdaq. In contrast, security-software company Sourcefire Inc. was more warmly received, closing up 4 percent.
"Given the recent market performance in virtually all sectors, BigBand Networks' opening was particularly impressive," said Scott Sweet, managing director of IPOBoutique.com, an IPO research service near Tampa.
"With an increased pricing above the original filing range, it is quite apparent that the placement of the stock was particularly well-done in this challenging environment."
Proceeds of the IPO will be used to repay debt, for working capital and capital expenditures.
BigBand helps cable operators and telephone companies increase the capacity on their customer lines, creating room for video, voice and data services. It also has an application that inserts advertising into broadcasts.
The company has more than 100 customers globally, including some of the biggest cable and phone companies in the U.S.: Cablevision Systems Corp., Charter Communications Inc., Comcast Corp., Cox, Time Warner Cable Inc. and Verizon Communications Inc.
Sales to BigBand's five largest customers accounted for about 90 percent of net revenue for the December quarter 2006 and 79 percent for the full year.
BigBand's IPO comes after a significant growth spurt. Its revenue soared 80 percent to $176.6 million last year.
BigBand also moved into the black for the first time last year, reporting an $8.9 million profit compared with a $25.5 million loss in 2005.
At the end of 2006, BigBand had an accumulated deficit of $111.3 million.
Venture-capital firm Redpoint Ventures owns 22.5 percent of BigBand after the offering, compared with 25.8 percent previously. It didn't sell any shares in the offering.
Time Warner Inc. has reduced its stake in BigBand from 4.1 percent to 2.9 percent after selling 360,140 shares.
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