Shares of Neutral Tandem jumped as much as 46 percent on Friday, a day after an initial public offering priced above a forecast range, raising more than 92 million. Neutral Tandem shares, after pricing at $14 on Thursday, opened on Friday at $18, then rose as high as $20.49 on Nasdaq.
In early afternoon trading the shares were at $19.63, up 40.2 percent. The offering of 6.65 million shares priced above a forecast range of $11 to $13 apiece. The Chicago-based company provides tandem interconnection services for telecommunications providers, from wireless to wireline, to Voice over Internet providers, or VoIPs.
At $19.63 per share, Neutral Tandem has a market capitalisation of about $580 million. The company sold 6.25 million shares in the offering, while selling stockholders put 400,000 shares into the offering. The company said it plans to use offering proceeds to fund expansion of its business, and for other general corporate purposes.
It had revenue of $38 million in the first six months of the year, and net income of $2.5 million. That compared with $24.2 million in revenue for the same period a year earlier, and net income of $3.3 million. Underwriters, led by Morgan Stanley, have the option to purchase an additional 1 million shares to cover over allotments.