On Semiconductor faces first
week
Chip maker moves into aftermarket
By Steve Gelsi, CBS MarketWatch
Last Update: 7:01 AM ET May 1, 2000
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NEW YORK (CBS.MW) -- A $480 million initial
public offering from On Semiconductor moved into its
second day of trading on Monday after posting a healthy
rise on its debut.
The chip maker quickly rose about 37
percent on its debut Friday,
maintaining the IPO market's
momentum a day after the blockbuster
AT&T Wireless Group debut.
On Semiconductor and Software
Technologies are the latest in a series
of IPOs that have slashed prices to
lure investors.
On Friday, On Semiconductor (ONNN: news, msgs)
closed at 21 15/16, well above its $16 price. The stock
opened at 22, hit a high of 32 1/2 and then dipped on
volume of 18.6 million.
"We feel really good," said Chief Executive Steve
Hanson.
The company debuted despite the overall rockiness in
the market because "we have a very solid business --
there's good value regardless of the condition of the
market," Hanson said.
The IPO marked the end of a 18-month process since the
company separated itself from Motorola through a
buyout with Texas Pacific Group in 1998 in order to
focus more closely on its business.
The chip maker offered 30 million shares via lead
underwriter Morgan Stanley at the middle of its
$15-to-$17-per-share price range.
The company adjusted its price range down from $16 to
$18 per share to drum up investor interest.
On Semiconductor is one of the largest independent
suppliers of semiconductor components in the world.
The Phoenix-based firm was formerly known as the
Semiconductor Components Group of the
Semiconductor Products Sector of Motorola (MOT:
news, msgs).
Customers include Agilent, Alcatel, Ford,
Hewlett-Packard, Lucent, Motorola, Nortel, Nokia and
Sony.
It rang up $1.8 billion in pro forma
revenue and net income of $74.4 million last year.
Hanson said the company expects to be profitable as it
moves forward as it grows its chip business to meet
worldwide demand sparked by wireless appliances and
other technology.
"We're in an explosion of applications," he said. "It's no
longer just a personal computer world." |
