NEW YORK-Toronto-based 724 Solutions Inc., which permits banks to offer their services over wireless devices, made a blockbuster debut on Nasdaq Jan. 28.
Its 6-million share initial public offering sold at $26 early Friday, two days after the company raised the expected price range to $20-$22 per share. In its November IPO registration with the Securities and Exchange Commission, 724 Solutions said it anticipated a share price range of $11-$13.
The timing and trajectory of the company’s inaugural share price were all the more outstanding considering the backdrop against which the debut was set. The Nasdaq composite index closed Jan. 27 down 30.35 points at 4,039.56 on fears the Federal Reserve Board will raise interest rates in early February.
The recent successful initial public offerings of Phone.com, Aether Systems and 724 Solutions testify to growing recognition by businesses that they must reach their customers through wireless channels, said Donna R. Oliva, chief executive officer of w-Trade Technologies, New York. w-Trade uses a patent-pending technology to provide wireless connectivity for electronic commerce.
“The wireless revolution is more than just an extension of the Internet economy,” she said.
“It’s a completely new paradigm that will change the way we all communicate, receive information and conduct business. It’s happening now.”
724 Solutions plans to use net proceeds from the $156 million IPO to develop its application hosting service, for research and development and for general corporate purposes. Credit Suisse First Boston served as lead underwriter for the stock sale.
Most of 724 Solution’s customers are large banks or telecommunications companies that also own part of the company. These include Bank of America, Bank of Montreal, Citigroup and Sonera.
