- Amid a selloff on the broader market, LoudCloud, the e-commerce hosting and site development company founded by Marc Andreessen, went public Friday with an initial public stock offering of somewhat lower valuation than previously expected.
Reaching the trading floor of the Nasdaq exchange on a downtick near midday, LoudCloud (LDCL) shares closed at $US6.16, up a mere $0.16 or 2.6% above the $6 issue price on volume of about 15.5 million shares.
LoudCloud faced harsh conditions for its IPO, both generally -- in terms of investors taste for technology issues after the bloodletting of the last year -- and specifically, on Friday. News of an earnings warning from chipmaker Intel Corp. sparked a technology sell-off which sliced 111 points off the Nasdaq composite index, lowering it 5% for the day.
LoudCloud was slated to post its IPO Thursday. The company delayed its anticipated offering until Friday, citing the Monday snowstorm which delayed meetings with investors, a company spokesman said.
The company boosted the number of shares offered to 25 million from 20 million, while reducing the price to $6 a share from a prior range of $8 to $10.
At the current level, the IPO is expected to generate $150 million, compared to between $160 million and $200 million at the previous price. Morgan Stanley Dean Witter & Co. and The Goldman Sachs Group Inc. will co-manage the sale, according to U.S. Securities and Exchange Commission filings.
LoudCloud builds and manages Web sites for large companies like Nike Retail Services Inc., News Corp. and Blockbuster Inc. In a flashback to days when profits mattered less than growth, LoudCloud has yet to make a profit, with losses of $180 million according to its SEC filing.
Investors view the IPO as the most recent test of the waters for the technology market.
LoudCloud, in Sunnyvale, California, can be reached at +1-408-744-7300 or at http://www.loudcloud.com/.