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Saifun and iRobot gain more than 20% in their market debuts after shares price above the expected range.

November 9, 2005

Robot maker iRobot and chip maker Saifun each rose more than 20 percent in their Nasdaq debuts Wednesday in a sign that the public markets are welcoming tech IPOs again.

Saifun, an Israeli semiconductor company, gained 28.55 percent in recent trading, up $6.71 to $30.21 after pricing at $23.50 per share, above its initial offer estimate of $20.50 to $22.50. The stock trades under the ticker SFUN and the IPO underwriters were Lehman Brothers and Deutsche Bank.

Saifun made $25 million on sales of $44.8 million during the first half of the year, up from a loss of $9 million on sales of $12.7 million during the same period last year.

The 5 million shares sold raised $117.5 million, of which Saifun expects to see $104.8 million. The underwriters have an additional option to sell 750,000 shares of the stock within the next 30 days.

Saifun licenses its intellectual property in the non-volatile read-only memory market to semiconductor manufacturers. The company was named Israel’s best startup by Red Herring in January (see Israel’s Best Startup).

The company signed a deal with China’s Semiconductor Manufacturing International Corporation in July estimated at $30 million to $40 million (see SMIC Inks Deal with Saifun).

Meanwhile, iRobot, the manufacturer of the automated Roomba vacuum cleaner, gained 22.36 percent in recent trading, up $5.36 to $29.36 after pricing at $24 per share. The offer price was up from the initial offer estimate range of $21 to $23 per share set by lead underwriters Morgan Stanley and JP Morgan. Its shares trade under the ticker IRBT.

iRobot closed its fiscal third quarter on October 1 with $9.7 million in net income on revenue of $52.5 million, up from the $2.8 million it earned on $28.9 million in revenue during the same period last year.

The company’s revenue, dominated by its sales of the Roomba, experience seasonality thanks to fluctuations in consumer spending and the third quarter is typically its most profitable.

The firm raised $37.5 million in venture funding, starting in 1998, from investors such as Trident Capital, Fenway Partners, First Albany, Acer Technology Venture Funds, Robotic Ventures, and Painter Hill Partners.