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Company News & Reports JMP, Solera and Biodel post double-digit gains in debut trading Quotes CBOE Bookstore NEW YORK, May 11, 2007 (AP Worldstream via COMTEX News Network) --Symbol Directory
Equity Options The stock market's three debutantes racked up double-digit percentage gains their first time on the dance floor Friday, with a Concepts pharmaceutical company defying recent trends and enjoying the biggest first-day gain of the three. Learning Center Biodel Inc., which specializes in treatments for diabetes and osteoporosis, investment bank JMP Group Inc. and insurance-software company Solera Holdings Inc. delivered swift increases. Biodel closed at $18 on the Nasdaq Stock Market, up 20 percent from its $15 initial public offering price. Some 5 million shares were sold into the IPO, which priced in the middle of the expected range of $14 to $16 set by underwriters by Morgan Stanley and Banc of America Corp. Scott Sweet, managing director of IPOBoutique.com, an IPO research service near Tampa, Florida, said Biodel's strong debut was somewhat surprising, given that many IPOs in the biotechnology sector have struggled to price within their expected range and have subsequently traded lower. "In late 2006 and in 2007, the sector has been a tough sell to dedicated biotech buyers," Sweet said. Biodel has two diabetes drugs in clinical trial, and two preclinical drug candidates for osteoporosis. Steve Brozak, a biotech and medical-devices analyst and president of broker-dealer WBB Securities LLC, said part of company's appeal is its focus on diabetes. "You have a perfect storm of American's getting fatter, a dearth of new products and the simple fact is (diabetes) is critically topical," he said. Biodel, which up until now has financed its activities mostly through private placements of its preferred stock, has incurred significant operating losses. It reported a net loss of $3.7 million (EUR 2.74 million) for the fourth quarter of last year and an $8.7 million (EUR 6.45 million) loss for the year to Sept. 30, 2006. At Dec. 31, it had accumulated a deficit of $16.5 million (EUR 12.23 million). Biodel co-founder and Chief Executive Dr. Solomon Steiner owns 22.2 percent of the company after the IPO, down from 29.9 percent before. Meanwhile, JMP Group closed at $12.30, 11.8 percent above its IPO price, after its first day of trading on the New York Stock Exchange. The San Francisco firm's IPO priced at $11 a share, within the expected range of $10.50 a share to $12.50 a share. Some 8 million shares were sold into the IPO, which was underwritten by JMP Group, Merrill Lynch & Co. and Keefe Bruyette & Woods. JMP has joined a suite of investment banks that have gone public in the past 18 months, including KBW Inc., Cowen Group Inc., Evercore Partners Inc. and Thomas Weisel Partners Group Inc. "JMP Group is not going to challenge long-established major tier-one firms like Goldman Sachs in the near term," Sweet said. "However, recent 'small' boutique investment-banking firms that have come public like Cowen Group, Thomas Weisel Partners and Keefe, Bruyette & Woods have performed quite well." JMP focuses on small and mid-cap companies, specializing in six industries: business services, consumer, financial services, health care, real estate and technology. It operates its business through two subsidiaries. JMP Securities conducts its investment banking, sales, trading and equity research businesses. JMP Asset Management manages the firm's hedge funds and other investment vehicles. JMP Securities contributed $79 million (EUR 58.58 million) last year, down from $86.5 million (EUR 64.14 million) in 2005, to the firm's total revenue of $88.8 million (EUR 65.85 million) in 2006, while JMP Asset Management contributed $7.8 million (EUR 5.78 million) , down from $8.1 million (EUR 6.01 million). JMP reported a profit last year of $3.4 million (EUR 2.52 million), down from $3.9 million (EUR 2.89 million).
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After the IPO, JMP's managing directors will own 46.4 percent of the firm.
San Ramon, California-based Solera also performed strongly, closing at $18.40, 15 percent higher than its $16 IPO price on the NYSE.
The offering priced at the midpoint of the expected range of $15 a share to $17 a share set by underwriters Goldman Sachs & Co. and JPMorgan Chase & Co. Some 26.25 million shares were sold, more than the original target of 21.9 million.
Solera provides software and services to more than 900 automobile-insurance companies, including nine of the 10 largest firms in Europe and the 10 largest firms in North America.
The software is used in part to estimate the cost of car repairs and determine fair market values for damaged cars.
According to Solera, the industry is highly competitive, with the company squaring off against CCC Information Services Group Inc. and Mitchell International Inc. in the U.S. and EurotaxGlass's Group and DAT GmbH in Europe.
Solera reported a net loss of $29.9 million for the six months to Dec. 31 on revenue of $227.7 million (EUR 168.84 million). The company warned that it expects to continue to incur net losses in the future, largely due to the amortization of its $403.4 million (EUR 299.13 million)of intangible assets at Dec. 31 and interest expense associated with its debt.
Private-equity firm GTCR remains the controlling shareholder of Solera, with 59.8 percent of the company, down from 90.6 percent.
Yvonne Ball is a Dow Jones Newswires correspondent.
Copyright (C) 2007 The Associated Press. All rights reserved.
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