The explosive IPO of investment bank Thomas Weisel looked a lot like one of the tech dandies the firm took public during the dot-com bubble.
Shares of San Francisco-based Weisel, which provides merger advice and underwriting to tech-focused companies, surged 33 percent to $19.90 in its trading debut yesterday.
The initial pop in the stock makes the 12 percent stake of the firm’s 64-year-old founder, Thomas Weisel, worth roughly $52 million.
The price jump surprised many on Wall Street who thought Weisel’s roller-coaster earnings over the past six years and its $14.2 million loss in the first nine months of last year would dampen interest in the stock.
Many also expected investors to lose confidence in the firm after bulge-bracket powerhouse Goldman Sachs dropped out as a lead underwriter for Weisel’s IPO, apparently over a dispute about the value of the firm.
The firm then elevated Keefe, Bruyette & Woods Inc. to fill Goldman’s spot and brought in smaller shop, Fox-Pitt Kelton, as a secondary underwriter.
In an unusual move, Weisel also served as the co-lead underwriter for its own offering, which will give it a slice of $6.3 million in banking fees paid to underwriters.
Weisel was created in 1998 by a group of former investment bankers from Montgomery Securities who grew the firm into one of the top tech boutiques on the Street.