Xtera IPO launches

Nov. 13, 2015
Long-haul optical transport systems vendor Xtera Communications, Inc. became a publicly traded company today. The company’s stock debuted on the NASDAQ exchange under the ticker symbol XCOM.

Long-haul optical transport systems vendor Xtera Communications, Inc. became a publicly traded company today. The company's stock debuted on the NASDAQ exchange under the ticker symbol XCOM.

The company priced its offering of 5 million shares at $5.00 each. Xtera initially had filed to offer 5.5 million (6 million, according to some press reports) at a share price between $9.00 and $11.00. No explanation for the reduction in offered shares or target price was given.

As of 1:37 PM Eastern, the stock was trading at $5.055. [Editor's Note: It closed at $5.00, it's initial price.]

Headquartered in Allen, TX, the company incorporated in Delaware in January 1998 as Bandwith Solutions, Inc.; it became Xtera Communications, Inc. in 1999. The company has made a name for itself by providing optical transport systems, first for submarine applications (see, for example, "Columbus Networks, Xtera bring 100G to the Caribbean"), then for terrestrial networks. The company leverages Raman amplification as a key technology and therefore touts its ability to support long reaches as a differentiator (see, for example, "TIM Brasil, Xtera deploy 100G optical network over 2400 km").

The company bought Canadian metro networks systems company Meriton Networks in 2008 (see "ROADM expertise a key to Xtera's acquisition of Meriton").

Needham & Company, LLC, Cowen and Company, LLC and BMO Capital Markets Corp. are acting as joint book-running managers for the offering. Xtera has granted the underwriters a 30-day option to purchase up to an additional 750,000 shares of common stock to cover over-allotments, if any.

In an amended S1 filing with the Securities and Exchange Commission (SEC), Xtera management stated that, for the three months ended September 30, 2015, they expect to report total revenue within the range of $14.8 million to $15.0 million, an operating loss within the range of $5.3 million to $5.5 million, and a net loss within the range of $6.6 million to $6.8million.

For more information on high-speed transmission systems and suppliers, visit the Lightwave Buyer's Guide.