Acme Shares Surpass Expectations

By Marc Ballon

Sept. 30, 1999 12 AM PT

Stock in the Santa Ana-based owner of WB-affiliated TV stations sells for $23 in IPO.

Shares of Santa Ana-based Acme Communications Inc., the owner of nine television stations affiliated with WB network, were priced higher than expected for the company’s initial public offering, an indication that Acme stock could sizzle in its first day of trading today.

For the record:

12:00 a.m. Oct. 9, 1999 For the Record
Los Angeles Times Saturday October 9, 1999 Home Edition Business Part C Page 3 Financial Desk 1 inches; 25 words Type of Material: Correction
Acme founder--Stories in the Business section about Acme Communications that appeared Sept. 30 and Aug. 3 misspelled the name of one of the broadcaster’s co-founders, Doug Gealy.

Acme’s stock was priced at $23 per share, compared to the $19 to $21 price range projected in documents that the company filed with the Securities and Exchange Commission.

Acme is a hot play with investors, analysts said, because WB has become the top-rated network for teens with prime-time hits such as “7th Heaven” and “Buffy the Vampire Slayer.”

The company’s offering of 5 million shares generated about $115 million. Acme plans to use the proceeds to repay debt, fund an acquisition and for general corporate purposes. Acme will have 16.75 million shares outstanding.

Jamie Kellner co-founded Acme in 1997, two years after launching WB with Time Warner and the Tribune Co. Tom Allen, the former chief financial officer for Fox Broadcasting Co., and Doug Geary, a television station executive who ran a WB affiliate in Columbus, are the other co-founders.

Kellner holds a 5.27% stake in Acme, and he and the founders hold up to 9% after the offering, according to the filing.

The company reported a net loss of $9.3 million on revenue of $11.1 million for the three months ending March 31.

Acme shares will trade on the Nasdaq market under the symbol ACME.