With the domestic IPO market in virtual limbo both before and after the Sept. 11 attacks, it is not surprising that venture-backed offerings were few and far between during the third quarter.
According to a report to be released tomorrow by Private Equity Week publisher Venture Economics and the National Venture Capital Association, just five venture-backed U.S.-based companies managed to execute public offerings over the past three months, raising a total of $279.9 million. While those figures are not even in the same league as the billions of dollars raised by the U.S.-based venture-backed companies that went public in Q3 2000, the percentage of decline was only slightly higher than the IPO market as a whole, which only saw 15 total offerings (U.S.- and foreign-based companies trading on U.S. exchanges)compared to 114 total offerings in Q3 2000.
Perhaps the most interesting characteristic of this past quarter’s offerings is that all but one of the U.S.-based deals came from the medical/health sector. Moreover, the next two IPOs expected to hit the market also come from the sector and have significant venture backing.
First up this week will be Israel-based biotech firm Given Imaging Ltd., which has raised just over $34 million from a group of investors that includes OrbiMed Advisors, Discount Investment Corp., Elron Electronic Industries, PEC and Rafael Development Corp. Its most recent round was a $30 million Series D transaction completed last fall.
The company hopes to raise approximately $65 million from its IPO, which is expected to price Wednesday.
Next week, Alameda, Calif.-based Therasense Inc. will unleash its own offering with hopes of raising up to $120 million. The glucose monitoring equipment maker has raised over $115 million from investors like Brentwood Venture Capital, Delphi Ventures, Lehman Brothers, InterWest Partners, MedVenture Associates and Sequoia Capital. Its most recent venture deal was a $56 million fourth round in January, which garnered TheraSense a $332 million post-money valuation.
Those medical/health companies that completed Q3 IPOs included OmniCell Inc., Alliance Imaging Inc., Natus Medical Inc. and Wright Medical Group Inc. The non-medical firm was integrated circuit maker PDF Solutions. As of mid-day trading last Thursday, the aggregate was trading approximately 2.4% below offering price.
Dan Primack can be contacted at: Daniel.Primack@tfn.com