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Tellium IPO Set for Next Week
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Tellium Inc.'s IPO has been set for next week.
Lead bankers Morgan Stanley Dean Witter & Co. and Thomas Weisel Partners now expect to price the company's shares during the week of May 14th, aiming to sell 7.5 million shares at between $13 and $15 apiece, which would raise between $97.5 million and $112.5 million for the company (see Tellium Hits the Road )
Tellium, which makes core optical switches, competes against companies like Ciena Corp. (Nasdaq: CIEN - message board), Corvis Corp. (Nasdaq: CORV - message board), Nortel Networks Corp. (NYSE/Toronto: NT - message board), and Sycamore Networks Inc. (Nasdaq: SCMR - message board).
In its most recent filing Tellium said Dynegy Inc. (NYSE: DYN - message board) accounted for approximately 70 percent of its revenues for the three months ended March 31, 2001, and Qwest Communications International Corp. (NYSE: Q - message board) accounted for about 30 percent of its revenues for the same period. Cable and Wireless (NYSE: CWP - message board) is also counted as a customer, but Tellium hasn’t counted any revenue from the contract yet, according to the filing dated April 27.
Tellium would be the first major optical networking startup to attempt an IPO in 2001. The only networking equipment and component companies that have tested the IPO waters this year were spinoffs, rather than true startups. These include Agere Systems (NYSE: AGR - message board), Lucent Technologies Inc.’s (NYSE: LU - message board) component spinoff, which was pushed out into the public market at the end of March at a reduced price of $6 a share (see Agere's Fistful of Dollars ). While the stock is still in the single digits, it is climbing from its debut price, trading at $7.56 a share today. Riverstone Networks (Nasdaq: RSTN - message board), which was the first networking company to IPO this year, was priced at $12 a share when it went out in February (see Riverstone IPO Toughs It Out ). The stock is now up to $18.50 a share in midday trading today.
-- Marguerite Reardon, Senior Editor, Light Reading
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