Parthus proposing secondary stock offer worth $200m

Parthus Technologies is expected to proceed with a secondary offering of shares worth $200 million (€239 million) on November 12th.

The mobile phone chip-maker yesterday confirmed it was considering a follow-on offering mainly comprising stock held by investors and management. A small amount of new equity will be issued as part of the placing, it said in a statement.

The offering cannot proceed before the lock-in period, which followed its flotation last May, expires on November 12th.

The Dublin company is likely to move swiftly to place the shares once that date is reached, though it said the exact timing and size of any offering would be subject to market conditions.

Parthus shares closed 31p sterling weaker at £2.65 sterling (€4.61) on the London exchange yesterday. The stock made strong gains in previous days after Parthus reported strong third-quarter revenues and introduced a new mobile-Internet product, which it claimed was the most advanced device on a single chip.

The company is seeking acquisitions to strengthen its position in the third-generation mobile telephony and Internet infrastructure software markets.

In mid-day trading on the Nasdaq yesterday, the stock was valued at $38.75 - $3.69 weaker than its previous close.

The company plans acquisitions in the US and Europe, but its statement said the purpose of the offering was to enhance liquidity in its shares on the London and Nasdaq exchanges.

Parthus's chief operating officer, Mr Kevin Fielding, signalled last week that it had cash reserves of $135 million to fund acquisitions. Parthus was evaluating 40 companies, Mr Fielding said.

Senior management figures are believed likely to sell up to 10 per cent of their shares in the offering and institutional shareholders are expected to sell up to a third of their stock.

The company's co-founder and chief executive, Mr Brian Long, holds 23 per cent of its shares. Its other co-founder and chief financial officer, Mr Peter McManamon, holds 6 per cent. The firm's chairman, Mr Michael Peirce, holds 3.8 per cent.

Parthus was worth more than £765 million sterling when floated on May 19th. It was valued yesterday at £1.6 billion.

The company's leading institutional shareholder is its underwriter Goldman Sachs which holds 18.8 per cent of the stock. Enterprise Ireland holds 8 per cent and venture capital company, Kelburn, holds 7 per cent.