|
|
| Home - Industry Article - Jan 03 Issue |
Software IPO Review: 2002 (Copyright 2003, SoftwareCEO Inc.)
continued... page 2 |
For the founders and CEOs of IPO companies, 2002 was a sobering.
The average stake that a CEO owned at the time of IPO was 3.4%,
compared to 22.3% in 2001. However, don't put an undue amount of
weight on the 2001 numbers, because there were only six IPOs in
the entire year, and in one of those the CEO's stake was not divulged.
Plus, the fact that three CEOs in 2001 had holdings greater than
25% skewed the median upward.
Still, this year's 3.4% is a bit lower than normal, and that's
because there's another factor at play: The 2002 crop included some
very mature companies. Half of this year's firms had revenues greater
than $130 million at the time of their IPOs; two companies were
around $700 million. Typically, when a company has grown to that
size the founder/CEO's stake has been diluted through multiple financings
plus options and warrants granted to the talent necessary to guide
the offering process.
Having said that, 2002 also presents a few impressive anomalies:
George Pedersen, the CEO of $378 million ManTech
International (Nasdaq: MANT) owns 96.4% of his firm's stock,
CEO Ernst Volgenau of SRA
International (Nasdaq: SRX) owns 68.3% of his company, and
MTC Technologies
(Nasdaq: MCTC) founder and chairman Rajesh Soin owns 57.7%. (We
didn't include Soin in our CEO metrics, because he doesn't hold
that title; if we had, the median ownership at IPO would have risen
to 5.1%.)
To put those percentages into somewhat staggering terms of dollars:
As of January 3, Pedersen's shares in ManTech were worth $492.5
million, Volgenau's stock in SRA was worth $209.7 million, and Soin's
piece of the MTC pie was worth just under $173 million.
Most CEOs of the 2002 crop of IPOs saw their stock rise handsomely
during the year — the median increase from the time of IPO
to January 3, 2003, was 31%. Not bad, considering the Dow Jones
Industrial average was down 16.8% for the year, the S&P 500
index was down 23.4%, and the Nasdaq composite index was down 31.5%.
However, the three software IPO firms that saw declines saw precipitous
ones: Shares in Plumtree Software, which went public in June, fell
69.1%, Printcafe
Software (Nasdaq: PCAF), another June entry, fell 87.5%
during the year, and SI
International (Nasdaq: SINT), which did its IPO in mid-November,
saw a 15.2% drop.
All the details on individual IPOs and the raw data behind them
are contained in the newly-updated SoftwareCEO M&A/IPO Tracking
spreadsheets. Plus, the same Excel file contains software industry
IPOs and mergers and acquisitions back through 1999. Site Members
can download the file as often as they want from our Downloads
Library; you'll find it in the M&A and Financing section.
 
|
|
|
