Liquid Audio shares on the Nasdaq stock exchange more than doubled in the first day of trading on Friday after the company launched an initial public offering.
The company, which produces software to publish and encode music that can be downloaded from the Internet, priced its initial 4.2 million shares at $US15 per share.The share price closed today at $36.50, up 143.7%.
The dramatic takeoff of the company follows the success of other recent Internet-related IPOs in general and with the increasing attention paid to companies that offer digitally delivered music, analysts said.
On Wednesday, Musicmaker showed strong gains in its first day of trading. It closed at $18 today, down $2.8.
Efforts to resolve online music copyright protection issues are bolstering the popularity of companies that develop technology for compressing and playing music over the Internet.
Also on Friday, more than 100 computer technology vendors, recording companies and consumer electronics groups who belong to the Secure Digital Music Initiative Group agreed to a technical specification for portable devices that store music in digital format.
"Liquid Audio is lucky in their timing." said Rob Enderle, an analyst at Giga Information Group in Santa Clara, California. "The industry will get a set of standards which the big providers of music, like the Sonys of the world, have agreed not to oppose."
Liquid Audio software allows musicians from more than 300 music labels to publish, syndicate and sell music to consumers over the Internet.
The IPO was managed by Lehman Brothers Inc., BancBoston Robertson Stephens Inc. and U.S. Bancorp Piper Jaffray.
Liquid Audio can be reached at +1-650-549-2038, or at http:/www.liquidaudio.com/.