Ocean Power Technologies, Inc. (OPTT-NASDAQ) priced its IPO of 5,000,000 shares at $20.00, and IPO subscribers are probably wishing they would have been on vacation. Book-runners were UBS, Banc of America, and Bear Stearns; and First Albany Capital Inc. was co-manager.
This $20.00 price came at a discount to a value on the LONDON AIM Exchange of $23.45, and the price range was $20.00 to $22.00. The truth is that this one opened under $20.00 on Wednesday, and closed just under $18.00; Thursday it opened down and then closed even lower ar under $17.00; and Friday the stock closed down under $16.00 at $15.55. How bad is this thing?
If you want an alternative energy play, this one stands entirely alone in its field as far as pure-plays. Ocean Power Tech develops and is commercializing proprietary systems that generate electricity by harnessing the renewable energy of ocean waves. Its PowerBuoy® system is based on modular, ocean-going buoys, which have been ocean tested for nearly a decade. The waves move the buoy-like structure creating mechanical energy that the Company’s proprietary technologies convert into electricity.
Sounds cool, sounds renewable, sounds uniques, sounds like a green play. Investors gave their votes of confidence by selling the shares. They think it sounds like Bu&^%$#@, or at least that’s what the money is saying. This is doubly troubling consider my own stance and the stance of much of the public that is a true backer of any alternative energy.
How many Vonage (VG) and Clearwire (CLWR) IPO’s are out there? It just looks and feels like this entire round of IPO’s on the "cool and speculative" trends aren’t going well. In fact, the integrity of the IPO market is going to be at stake if these IPO’s keep flopping. These private equity billionaires sure better look long and hard at what they are acquiring, otherwise they aren’t going to have an IPO market to resell their acquisitions back to.
Jon C. Ogg
April 28, 2007
Jon Ogg can be reached at [email protected]; he does not own securities in the companies he covers.
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