- The Washington Times - Friday, September 29, 2000

Sterling, Va.-based software company Vastera Inc. yesterday raised $84 million on its first day on the stock market 55 percent more than the $54 million it planned to make.
Vastera's stock ended the day up 23 percent, closing at $17.25 a share from an offering price of $14 after first-day trading on the Nasdaq stock market.
"Any expectations I had were exceeded today," Vastera Chief Operations Officer Mark J. Ferrer said.
Vastera makes software to help companies manage global transactions by gathering information about everything from obscure taxation issues to trade agreements so multinational companies know the cost of importing and exporting goods.
That's significant in an era of growing international trade. Global trade increased from $4.1 trillion in 1980 to $11 trillion in 1998, according to the World Trade Organization.
Vastera initially decided to sell 6 million shares of common stock for as low as $9 a share. Ultimately it sold shares for $14 each.
Vastera took advantage of good timing yesterday, said David Menlow, president of Millburn, N.J.-based IPOfinancial.com.
More initial public offerings are getting a favorable reception from investors and the number is likely to increase in the fourth quarter, Mr. Menlow said.
"The market is back in business," he said.
Still, Vastera's performance was a bit surprising because it's a business-to-business technology company, Mr. Menlow said.
"Since spring, many business-to-business deals have been viewed with a jaundiced eye," he said.
"It's been a choppy market," Mr. Ferrer said.
Vastera has yet to have a profitable year. But a huge agreement the company signed with Ford Motor Co. in July guarantees it revenue of $47 million through 2004. That includes $4.5 million in 2000 and $11.6 million next year, according to Vastera's registration statement filed with the Securities and Exchange Commission in April.
Vastera registered a net loss of $10.4 million in 1999 on revenue of $19.1 million. It lost $8.2 million in 1998 on revenue of $8.8 million. The company declined to indicate when it plans to be profitable.
Under the terms of its agreement with Ford, Vastera acquired the automaker's global-trade division and will oversee all of its import-export trade business. Ford is among the largest importers and exporters in the world, operating 112 plants in 25 countries.
In turn, Ford receives 8 million shares of Vastera's stock, worth $79.2 million. That transaction makes Ford the majority owner of Vastera with a 23 percent stake.
San Mateo, Calif.-based venture-capital firm Battery Ventures owns 21 percent of the company. Co-founder and Chief Executive Arjun Rishi, 36, owns 5 percent of the company. Mr. Rishi and Executive Vice President George Bardos started Vastera in 1992.
Vastera employed 234 persons as of June. It has hired 29 of the 110 persons who had worked at Ford's global-trade operations.
With yesterday's public offering, Vastera's market capitalization reached $483 million.
Deutsche Banc Alex. Brown, Chase H&Q;, and Banc of America Securities LLC were the lead underwriters of the initial public offering.

LOAD COMMENTS ()

 

Click to Read More

Click to Hide