Budgeting, Planning & Forecasting

Budgeting, Planning & Forecasting

May 27, 2011

Freescale Announces IPO at Lower Price

On Wednesday, RF and mixed-signal semiconductor supplier Freescale Semiconductor (News - Alert) Holdings I, Ltd. announced an initial public offering (IPO) of 43,500,000 common shares at $18 per share. The common shares began trading on Thursday on the New York Stock Exchange under the symbol "FSL." The offering is expected to close on June 1, 2011, according to Freescale.

In connection with the offering, Freescale granted the underwriters a 30-day option to purchase up to 6,525,000 additional common shares at the public offering price less underwriting discounts to cover over-allotments, if any.

The shares closed a little higher on the first day of trading, showing a 1.8 percent gain on a price of $18.00 per share. Also, on Friday, it opened higher at $18.67 then dropping to $18.51. Initially, the company had plans to launch the IPO in the price range of $22 to 24. Nevertheless, the company is bullish on its IPO offering.

Citi, Deutsche Bank Securities, Barclays Capital, Credit Suisse and J.P. Morgan are acting as joint book-running managers for the offering. Goldman, Sachs & Co., RBC Capital Markets, UBS Investment Bank, Sanford C. Bernstein, Gleacher & Company, Oppenheimer & Co., Pacific Crest Securities and Piper Jaffray are acting as co-managers for the offering, Freescale said in a press release.

The company said that the IPO offering is being made solely by means of a prospectus which may be obtained by contacting Citi or Deutsche Bank Securities.

According to a report in Investor’s Business Daily, Freescale went public for the first time in 2004. In December 2006, the company was bought by private equity investors led by the Blackstone Group for about $17.6 billion. Since then the company has been burdened with a massive debt. It went public again on Thursday. The Investor’s report indicates that Freescale is planning to use $742 million from the proceeds of the IPO to pay some of that debt.

Ashok Bindra is a veteran writer and editor with more than 25 years of editorial experience covering RF/wireless technologies, semiconductors and power electronics. To read more of his articles, please visit his columnist page.

Edited by Rich Steeves

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