April 29 (Bloomberg) -- Convio Inc., a maker of marketing software for non-profit organizations, advanced as much as 22 percent in its first day of trading after cutting the price of its $46.2 initial public offering.
Convio sold 5.13 million shares at $9 each yesterday after offering the stock at $10 to $12, according to a filing with the Securities and Exchange Commission and Bloomberg data. The Austin, Texas-based company climbed as high as $10.99 in Nasdaq Stock Market trading. Alpha & Omega Semiconductor Ltd., the Hamilton, Bermuda-based maker of chips that extend the battery life of laptops, fell 1.7 percent to $17.70 after raising more than $91 million.
Convio reduced its IPO price after credit-rating downgrades of Greece, Portugal and Spain roiled equity markets and last week’s offerings in the U.S. raised 21 percent less than sought. All seven companies asked buyers to pay a premium after the Standard & Poor’s 500 Index’s rally to the highest level since 2008 had revived demand for IPOs.
“When you price a deal with that much of a discount, you’re pricing it where the buyers wanted,” said Salvatore Morreale, a Los Angeles-based institutional sales trader who tracks IPOs for Cantor Fitzgerald LP. “That’s a case where they priced it right. They obviously made sure the deal was where it was going to be attractive.”
The S&P 500 has lost 0.9 percent since April 23 amid concern defaults by debt-laden nations will damp the global economic recovery.
Alpha & Omega
Alpha & Omega sold 5.09 million shares at $18 each, the middle of its forecast range, according to the statement and its SEC filing. The IPO valued the semiconductor producer at 1.28 times its estimated 2010 sales, 27 percent less than the average for the 10 U.S. companies that the company cited in its prospectus as rivals, data compiled by Bloomberg show.
Deutsche Bank AG of Frankfurt and Minneapolis-based Piper Jaffray Cos. were hired to lead Alpha & Omega’s offering. Piper Jaffray also managed Convio’s sale, along with Thomas Weisel Partners LLC in San Francisco.
The sales came with the S&P 500 trading at 13.8 times forecasts for its companies’ earnings, lower than any time since 1990, except for the months after New York-based Lehman Brothers Holdings Inc. collapsed.
“Investors are choosy because of what they already have available for them to buy,” said David Goerz, who oversees $17 billion as chief investment officer at Highmark Capital Management in San Francisco. “Stocks overall are relatively cheap, so pricing is going to be crucial for a company trying to do an issue in the market.”
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