Comverse Technology Inc. (Pink Sheets: CMVT) yesterday sold 2.3 million shares in Verint Systems Inc. (Nasdaq: VRNT), at $35 per share for a total gross proceeds of $80.5 million. The sale reduced Comverse's stake in Verint from 50.5% to 44.3%
There were two aspects to the success of the sale. The offering was oversubscribed seven-fold, which meant that the underwriters exercised their over-allotment option to buy 300,000 Verint shares, in addition to the original two million shares offered by Comverse. Second, the offer price of $35 per share gives Verint a market cap of $1.3 billion. The share price rose 2% at the opening today to $35.90 yesterday, after rising 85% over the preceding year.
The success demonstrates investors' interest in Verint, a developer of surveillance software and competitor of NICE Systems Ltd. (Nasdaq: NICE; TASE: NICE). Investor interest is also strong at NICE, whose share price has risen 45% over the last two years, is unchanged at the opening on Nasdaq today at $34.05, giving a market cap of $2.14 billion.
Comverse has not said if it plans to sell more Verint shares, but the strong demand in the present offering might prompt it to do so. Comverse is trying to sell subsidiaries in whole or in part to US private equity funds or technology companies. Comverse's share price was unchanged at the opening today $7.35, giving a market of $1.5 billion.
Credit Suisse Securities (USA) LLC was sole bookrunner for the offering, Barclays Capital Inc. and Morgan Stanley & Co. Inc. were the joint lead managers, and RBC Capital Markets LLC and Oppenheimer & Co. Inc. were the co-managers.
Published by Globes [online], Israel business news - www.globes-online.com - on January 11, 2011
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