IPO Market Exhibits Signs of a Rebound
The market for initial public stock offerings showed signs of life Thursday as oil spinoff Conoco Inc. and Japanese cellular phone company NTT Docomo completed huge stock sales.
The deals came after two months of near drought for new stock sales, one of the worst stretches since the mid-1970s.
Conoco, the eighth-largest U.S. oil producer and refiner, raised $4.4 billion in the biggest-ever U.S. initial stock sale.
Dupont Co., which bought Houston-based Conoco in 1981, sold a 30% stake to the public, or 191.5 million shares. The stock was offered at $23 each, near the high end of the $20-$24 range set by underwriter Morgan Stanley Dean Witter. Shares rose $1.88 to $24.88 on the New York Stock Exchange.
Shares in Tokyo-based NTT Docomo, or NTT Mobile Communications Network, rose 19% to $39,500 in their debut, and investors forecast more gains ahead.
“It’s in a sexy industry--telecom--and they priced it low to almost guarantee its success,” said Stephen Bronte of Stephen Bronte Partners, a Japanese equity hedge fund in Tiburon, Calif. The number of shares requested for the offering was twice the number available.
The issue’s initial favorable performance was considered crucial to the Japanese government’s plans to boost the economy, now in its worst recession in 50 years.
