IPOs in Short Supply

For the first part of the year, the Nasdaq was gas ‘n’ go. All that the
momentum investors heard was the siren song of tech stocks. That came to an
end when these investors’ nerve failed and they panicked. The result was
the
25 percent drop in the Nasdaq.

This last week, buyers were back. On Tuesday, the Nasdaq had its biggest
one-day point gain, 254 points. For the week, there was positive gain.
Even the Queen of the Net, Mary Meeker, has proclaimed that the worst is
over. Lets hope so.

As for last week, there were only a few IPOs. Then again, it was a short
trading week due to Good Friday.

QS Communications (QSCG) gave it a try on Wednesday. QS Communications rose
26 percent to 30 1/8 from its opening of $24.64. It was down to 28 = on
Thursday.

QS Communications is a German provider of high-speed DSL Internet access for
small and midsized businesses in Germany. QSC is constructing a network
linking 40 German major cities. They project that by next year, they will
serve more than 20 million customers with full broadband service nationwide.

The lead underwriter was Morgan Stanley Dean Witter.

On Thursday, 360networks (TSIX.), a fiber-optic network builder, priced
their
IPO at $14, which was under the proposed $16 to $18 range. This was a
shrewd
move as 360networks rose 36% to 19 by the end of trading. In the New Net
reality, such a rate of return is consider very good.

360networks is quite the fiber-optic builder. They project that by the end
of
2001, their overall network will be approximately 56,300 route miles, mainly
in North America and Europe. They are also building two fully protected
undersea cables. One is a 7,600 route mile cable between America and
Europe and the other, a 14,000 route mile cable between South America and North America. Seems like there is lots of this cable already but investors nonetheless are interested.

The co-lead managers were Goldman, Sachs and Donaldson, and Lufkin &
Jenrette.

The San Francisco-based Embarcadero Technologies (EMBT) also got a good
reception. They too lowered their initial price and saw a 60 percent
increase.
It went from 10 to 16, raising $42 million.

Embarcadero Technologies helps companies with their enterprise and
e-commerce
databases. Its primary product, DBArtisan, works across multiple operating
and hardware systems. Customers includ GTE, AT&T Wireless Services, Bank of America, and Universal Studios.

The lead underwriter was Donaldson, Lufkin & Jenrette.

PEC Solutions (PECS) just was not buff enough. Facing little investor
interest, it had dropped its opening price. It wasn’t enough. It opened at
9-1/2
and staggered to 9 by the end of the trading.

The Fairfax, Va., PEC Solutions provides Internet and security technology
services mainly to government, often building their applications from the
ground up, as well as integrating with legacy systems. They provide
encryption programs to protect sensitive information, including biometric
authentication, a process that identifies people by their physical
characteristics. Definitely cool stuff. But it was not what investors
wanted.

Donaldson, Lufkin & Jenrette was the lead underwriter.

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