SolarWinds Raises $150 Million in IPO
May 26, 2009 Alex Woodie
The economy may be in the dumper, and initial public offerings (IPOs) of technology stocks may be a lean trickle of what they used to be. But last week was apparently the right time for SolarWinds to go public. The Texas-based developer of affordable systems management software for mid size businesses raised $151 million on the New York Stock Exchange.
SolarWinds is one of a growing number of company that offers a lower-cost alternative to the systems management software from the “Big Four” vendors–BMC Software, CA, Hewlett-Packard, and IBM. The vendor, which was founded in 1998, has 250 workers, and claims to have 80,000 customers, ranging from small businesses to Fortune 500 enterprises. The company supports basic AS/400 monitoring and management, and a handful of AS/400 shops have purchased the company’s products.
SolarWinds went public on the New York Stock Exchange last week under the sticker symbol SWI. The company looked to sell more than 12 million shares at a price of $12.50 per share. The IPO raised $151 million, or about $600,000 per employee–a relatively strong IPO that will give SolarWinds a war chest to fund its continued expansion.
SolarWinds’ strong IPO spurred talk of a resurgence in public offerings in the tech sector. SolarWinds was the fifth U.S. company to go public this year on the NYSE. Four of those have been tech companies. In addition to SolarWinds, Rosetta Stone raised $129 million, Bridgepoint Education raised $163 million, and DigitalGlobe raised $279.3 million.
IPOs are down significantly from a year ago. According to financial analyst and software development firm Dealogic, IPOs are down 78 percent from 2008. And the total value of IPOs are down 94 percent. It’s only May, and maybe those numbers are about to change.
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