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News

11 June 2007

 

Infinera’s $182m IPO exceeds expectations

Last Thursday, Infinera Corp of Sunnyvale, CA, USA, a manufacturer of InP-based photonic integrated circuits and optical networking equipment, closed its initial public offering of 14 million shares of stock at $13 per share, raising $182m. (On 21 May, the firm said that it expected to sell the shares for $10-12 per share, raising $139m.) After discounts for underwriters, the proceeds are more than $169m.

Since being founded in December 2000, Infinera has already raised $315m in private equity funding. The firm started to ship products in November 2004. Losses were $66.5m in 2004 (on $0.6m in sales), $64.8m in 2005 (on $4.1m in sales) and $89.9m in 2006 (when 75% of the $58.7m in sales came from just two companies: Level 3 Communications and Broadwing, which Level 3 bought in January).

However, most recently, losses have been cut to $19.8m in Q1/2007 (from Q4/2006’s $25m), while sales rose to $49.2m (up 12% from Q4/2006’s $44.3m and up almost 17-fold year-on-year). During Q2/2007, Infinera won two new customers: San Francisco-based ‘business-grade’ IP service provider Telekenex and The State of New Mexico’s General Services Department, Communications Division. Analysts project that, if the high revenue growth rate continues, then Infinera should become profitable in about 2009.

In addition to repaying some of its $334m of debt, Infinera says it will use the IPO’s proceeds for general corporate purposes and working capital, to fuel growth, develop new products, or to “expand our existing business through acquisitions of other businesses, products or technologies”.

Trading on the NASDAQ Global Market opened last Friday at $16 and closed at $19.71 at the end of the first day (up 52% on the $13 IPO price), despite NASDAQ falling 1.8% overall.

*An extra 2.1m shares may go to the IPO’s underwriters, raising the offering to as much as $209.3m.

See related items:

Infinera prices IPO to raise $139m

Infinera files for IPO to raise up to $150m

Visit: http://www.infinera.com