Increase In Size Of Two IPOs May Indicate Mkt Awakening >TFT 09/09/1996 Dow Jones News Service
(Copyright (c) 1996, Dow Jones & Company, Inc.)
NEW YORK (Dow Jones)--Two planned initial public offerings were increased in size today, reversing weeks of cuts in price and number of shares offered for new issues.
This may indicate that the IPO market is awakening from the summer doldrums and regaining strength as it shakes off the sharp correction that forced many deals to be postponed.
Steven Samblis , president of Samblis Financial Corp. in Longwood, Fla., said the news shows that underwriters believe the market can absorb larger deals - and this will create a positive domino effect in the
market.
'It will open people's eyes,' he said. 'Sometimes you just need someone to step through the door to show that there are no monsters in the room.'
Announcing increases today were Thermo Fibergen Inc. and Ensec International Inc.
Registrations continue to build and strong activity in the new issues market is expected to resume by mid-October.
Ryan Jacob, research director for the IPO Value Monitor in New York, said the number of companies filing planned IPOs with the Securities and Exchange Commission has increased in the last few weeks.
'Underwriters are sticking their toes in the water and starting to file again,' he said. 'Sometime in early to mid-October, we'll see these deals come to market. The deals will be out there, but how they'll be received
is still in question.'
Thermo Fibergen of Bedford, Mass., a unit of Thermo Fibertek Inc. (TFT), increased the size of its planned IPO to 4.1 million units from 3.1 million through underwriters led by NatWest Securities Corp. Price talk
remains at $12.75 a unit.
Each unit consists of one common share and one redemption right, entitling the holder to sell one share back to the company during specified times in the future.
Thermo Fibergen is developing systems to recover materials from pulp residue generated by plants that produce recycled pulp and paper.
Ensec International of Boca Raton, Fla., increased its planned offering to 1.85 million units from 1.7 million via Rickel & Associates Inc. Price talk is $6 to $6.50. The company provides electronic security systems for large buildings.
David Menlow, president of the IPO Financial Network in Springfield, N.J., said the increase in size of the planned deals is good news, but not of cosmic significance for the IPO market.
'It's not a barometer for the entire new issues market,' he said. 'It's an indication of demand for companies in a niche market.'
(END) DOW JONES NEWS 09-09-96
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