Investors Finally See Some Internet IPOs They Like

After a rocky several weeks, Internet IPOs again registered big first-day pops Wednesday as investors cheered the quality of the latest offerings.

Ariba Inc.’s 291% jump marked one of the biggest one-day gains for an initial public offering in weeks.

Sunnyvale, Calif.-based Ariba (ticker: ARBA), which provides software for the business-to-business e-commerce market, rocketed $67 to close at $90 on Nasdaq.

Two other IPOs also registered strong first-day gains:

* GlobeSpan Inc. (GSPN), which develops integrated circuits used to enable high-speed data transmission over regular copper phone lines, raised $48.75 million in its IPO. The deal, at $15, was priced above its expected range of $9 to $11 and gained about 182%, or $27.31, to $42.31.

* TD Waterhouse Group Inc. (TWE), the No. 2 U.S. discount brokerage, rose 7% to close at $25.63 on the New York Stock Exchange after being aggressively priced at $24. The company raised a massive in capital $1 billion after boosting the size of its offering by nearly 30% to 42 million shares.

“The entire day is nothing but a huge surprise,” said David Menlow of IPO Financial Network in Millburn, N.J. “I think we are looking at three quality offerings. People have been waiting for the Internet market to bottom and jump in with both feet, but with the higher-quality deals.”

Most analysts had expected the latest deals to perform well because they were in hot areas. Recent Internet content companies, or “pure plays,” have not been received warmly by investors, but companies engaging in Net technology have fared better.

“I think that is what is selling the business--that [Ariba has] something to do with the infrastructure and backbone,” said David Klaskin, president of Oak Ridge Investments in Chicago.

“Business-to-business commerce is the next hot wave in the Internet space,” said Steven Singh, chief executive of Redmond, Wash.-based Concur Technologies Inc., a competitor of Ariba.

The market for business-to-business electronic commerce is expected to grow to $1.3 trillion in 2003 from $43 billion in 1998.

In a deal priced late Wednesday, Santa Barbara-based Software.com Inc. (SWCM), which makes messaging software, sold 6 million shares at $15 apiece--above expectations. It begins trading today.