Kana Communications triples in price after IPO
NEW YORK, Sept 22 (Reuters) - Shares in Kana Communications Inc. (NASDAQ: KANA) more than tripled in value Wednesday after their initial public offering, as investors continued to reward e-commerce software providers.
Shares of the Palo Alto, Calif-based firm climbed 42-11/16 to 57-11/16 on the Nasdaq, with 18.6 million shares traded by early afternoon.
"We've got a hot market. The only surprise is how high is high," said John Fitzgibbon, a veteran IPO analyst, now with Redherring.com. "Kana has the magic word 'Internet' and a great underwriter."
Kana raised $49.5 million through its offering, in which 3.3 million shares were priced at $15, the top of an upwardly revised price range. It had initailly expected the IPO, which represented a 12 percent stake in the firm, to price in a range of $11-$13.
Goldman Sachs was the lead underwriter on the deal.
Companies such as Kana, which help e-commerce firms manage their e-mail and assist with customer service, fill an important role in Internet retailing, analysts said, noting that was one reason Kana's deal was well-received.
Gartner Group estimates that firms will receive 25 percent of all customer inquiries through e-mail and Web-based forms by 2001, but most remain unprepared to address the growth of e-mail and Web-based communications.
Some analysts also pointed that Benchmark Capital's David Beirne, a top technology recruiter, was a Kana director.
Kana posted total reveneus of $3.6 million and a net loss of $9.9 million for the six months ended June 30.
One of its competitors, eGain Communications Corp. (NASDAQ: EGAN), is also slated to debut this week |
