From May 1995 to December 1997,
Express (ITE) was basically a supplier of integrated circuits, as well as
related software solutions. But the company sold this line of business and
instead rushed on the bandwagon of the red hot broadband equipment industry.
It was definitely a good move. After all, the company is now poised to go
public this week. The lead underwriter is Lehman Brothers and the price
range is $17-$19 (the company intends to issue 5.6 million shares). The
proposed ticker symbol is ITXI.
The company now builds advanced components and modems for the ADSL
(asymmetrical digital subscriber line) marketplace. The first products were
shipped in the third quarter of 1999. So far, ITE offers two families of
products. Apollo is a mix of net interface cards, external modems,
gateways, routers and central office ADSL equipment. Then there is SAM,
which is a scalable ADSL modem. There are currently 26 pending worldwide
patents on the ITE technology.
Despite being a recent entrant to the marketplace, the company has been
ramping up its sales tremendously. In the first six months of 2000,
revenues were an impressive $14.4 million. Customers include: CAN
Technologies, Alcatel Bell N.V., Garnet Systems, Interlink System, Nokia and
Of course, there were losses: $11.5 million. There is also other risk
factors: two customers account for 39% of revenues and 59% of the revenues
derive from south Korea.
But the company’s rapid acceptance of its product line, as well as the surge
in demand for ADSL products, should mean a strong IPO this week. Also,
similar IPOs have done well, such as Virata
. The company had
its IPO in November 1999 at $7 per share (adjusted for a split). The stock
now trades at $77-1/2.