Shares of event-management software maker Cvent jump 85 pct in debut
REUTERS - Shares of event-management software maker Cvent Inc (CVT.N) rose as much as 85 percent in their market debut, mirroring the success of recent IPOs by other cloud-based service providers.
Investors have been pouring money into cloud-based software makers that operate in a niche market, as many of them have strong business models and are profitable with room for growth.
Niche cloud companies that have had strong debuts this year include big data company Tableau Software Inc (DATA.N), ecommerce software company ChannelAdvisor Corp (ECOM.N) and Textura Corp (TXTR.N), a software maker for the construction industry.
Cvent's initial public offering was priced at more than 10 percent above the top end of the expected pricing range.
The company's shares, which were priced at $21 each, touched a high of $39.28, valuing the company at about $1.52 billion.
The pricing range had been set at $17-$19 per share.
The offering of 5.6 million shares raised $117.6 million.
McLean, Virginia-based Cvent, which was formed in 1999, helps customers plan events, find venues, create mobile apps and send surveys through its event management platform.
"They kind of created a new cloud category over the years and as such their barriers to competition is very high," said Francis Gaskins, a partner at IPO research firm IPOdesktop.com.
Visa Inc (V.N), Wal-Mart Stores Inc (WMT.N), Edwards Lifesciences Corp (EW.N), Hyatt Hotels Corp (H.N) and Starwood Hotels & Resorts Worldwide Inc (HOT.N) are some of the company's major clients.
Cvent's revenue grew 37 percent to $83.4 million in 2012, helping the company post a profit of $4.3 million, or 12 cents per share, compared with a loss of $184,000, or 1 cent per share.
The company is backed by venture capital firms Insight Venture Management LLC and New Enterprise Associates Inc.
After the offering, Insight Venture will have a 22 percent stake, while New Enterprises will own 19 percent of the company.
Net proceeds from the offering would be used for business expansion and working capital, the company said.
Morgan Stanley and Goldman Sachs were the lead underwriters for the IPO.
Shares of the company were up 71 percent at $35.77 on the New York Stock Exchange at 1100 ET. About 2.4 million shares changed hands, making them one of the most active stocks in early morning trade on the New York Stock Exchange. (Reporting by Avik Das and Anil D'Silva in Bangalore; Editing by Ted Kerr and Sriraj Kalluvila)
- Tweet this
- Share this
- Digg this
- India to allow Nokia to transfer Chennai factory to Microsoft
- SPECIAL REPORT - In the land of the holy cow, fury over beef exports
- GMR, Megawide group set to win Philippine airport contract
- GMR picks Citi, three others for $300-$350 million airport IPO - sources
- BSE Sensex to touch 24,000 by end-2014: Reuters poll
Relief for Nokia
A court on Thursday accepted an appeal by Nokia to release its local factory after it was seized by authorities in a tax dispute, removing a hurdle to the sale of the company's mobile phone business to Microsoft . Full Article
China official says has "substantial" price-fixing evidence against Qualcomm - media. Full Article
Apple medical experts say Pegatron factory death unrelated to working conditions. Full Article