Market Sees Netscape Most Savory IPO Since Boston Chicken 08/07/1995 Dow Jones News Service (Copyright (c) 1995, Dow Jones & Co., Inc.)
NEW YORK -DJ- Netscape Communications Corp.'s hot initial offering is expected to be priced early this week, possibly tomorrow. Nothing else matters much.
There are other good deals scheduled to come to market, but Netscape is viewed by many as the Boston Chicken Inc. (BOST) of 1995 and is likely to overshadow the other deals.
'Netscape is going to be a monster - probably one of the best new issues of the year,' said Steven Samblis , an analyst at Empire Financial Group in Longwood, Fla. 'I've got people calling me and saying, 'Is there any way I can get this?' It's almost impossible for a normal guy to receive an allocation of the new issue, but when the market opens, attack it.'
The company is best known for Netscape Navigator, a point-and-click software package that helps users cruise the Internet. Many companies advise users clicking on their web sites that the information looks best if displayed with Netscape's software.
Netscape plans to offer 3.5 million shares, including 500,000 to international investors, at $12 to $14 each through underwriters led by Morgan Stanley & Co. Netscape's products also allow individuals and
organizations to exchange information and complete secure financial transactions over the Internet. The company's products include Netscape Commerce Server and Netscape Communications Server.
Samblis said he expected Netscape's IPO to be priced at about $14 a share with the first trade at about 25. He estimated the stock will go to about 27 the first day and reach the high 30s within 10 days.
'Next to Spyglass, this is one of the most exciting new issues of the year,' he said. 'This is getting close to the light bulb in importance. Netscape allows a small businessman to have the same imformation in his hands as a big corporation so anybody can compete with anybody else. I think you'll see people continue to buy this stock.'
Spyglass Inc. (SPYG) of Naperville, Ill., offers Enhanced Mosaic, another Internet browser. The company also offers Spyglass Server, a software product to manage and control access to information stored at
individual web sites.
On June 26, Spyglass priced 2 million shares at $17 each through underwriters led by Alex. Brown & Sons Inc. Price talk was $11 to $13 a share. The stock peaked at 45 3/8 and closed Friday at 43 1/4.
In November 1993, Boston Chicken priced 1.9 million shares at $20 each through underwriters led by Merrill Lynch & Co. The stock opened at 45 1/2 and went as high as 51 on the first day of trading.
Boston Chicken rivaled the performance of previous high fliers. In October 1980, Genetech Inc. (GNE) opened at 35 and closed at 71 1/4. Six years later, Home Shopping Network (HSN) shot to 42 5/8 from 18
in its first day of trading.
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