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OMP Becomes 2nd Company to Cancel IPO at Last Minute

February 15, 2001|From Times Staff, Bloomberg News

The market for initial public stock offerings suffered another blow Wednesday as the second company this year pulled the plug on its deal at the last minute.

OMP Inc., a Long Beach-based drug company, had planned to sell 4.5 million shares for $11 to $13 each this week. But the company said Wednesday that it canceled its IPO plans, citing market turmoil.

In a statement, OMP Chief Executive Phillip J. Rose said that given the "current conditions in the equity markets and the strength of our business, it is in the best interest of our shareholders not to proceed with the offering at this time."

Though many private technology firms have found it impossible to sell stock given the crash in the tech sector in the last year, some analysts had expected the market to stay receptive this year to non-tech issues.

But of six IPOs that have come to market this year, half are trading below their offering prices.

OMP isn't a tech firm: The company markets a portfolio of products that physicians can use to treat such problems as sun damage, acne and wrinkles.

Brokerages CIBC World Markets, Thomas Weisel Partners and U.S. Bancorp Piper Jaffray were to underwrite OMP's sale.

OMP is the second company this year to pull or postpone an IPO after setting a date for the sale. Xenogen Inc., a biotechnology company, also pulled its IPO after planning a sale in the last week of January.

Many young companies have withdrawn their IPOs in recent months, long before getting as far as setting an offering date.

Since Jan. 1, 33 IPOs have been postponed or withdrawn, according to Thomson Financial Securities Data. That's about double the number in the same period last year.

Still, about 225 companies are hoping to float IPOs in the near future, though analysts say most of those issues are unlikely to come to market, barring a dramatic stock market rebound.

Earlier this week, Yupi Internet Inc., a Spanish-language Internet start-up that runs an entertainment and news Web site, canceled its IPO plans.

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The New Year's IPOs

Initial public stock offerings launched this year are a mixed bag so far--with three up and three down from their offering prices.

*--*

Ticker IPO IPO Wed. Pctg. Company symbol date price price change Peet's Coffee PEET 1/25 $8.00 $11.50 +44% Align Technology ALGN 1/26 13.00 11.63 -1 Exact Sciences EXAS 1/31 14.00 11.06 -1 ATP Oil & Gas ATPG 2/6 14.00 12.56 -0 Williams Energy WEG 2/6 21.50 26.25 +22 KPMG Consulting KCIN 2/8 18.00 22.50 +25

*--*

Sources: Times research, Reuters

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