SolarWinds Shares Price Above Estimate

(Reuters) – Software maker SolarWinds Inc’s (SWI.N) shares priced at $12.50 per share in the company’s initial public offering Tuesday, above the estimate range, the company said.

The Austin, Texas-based maker of network software sold 12.1 million shares, raising $151.5 million in the first venture-capital backed IPO by a technology company in the United States in more than nine months, and the sixth overall on a U.S. exchange so far in 2009.

“Ten years ago, a tech company would be in the R&D phase, not serving Fortune 500 companies before trying an IPO — it’s a mature, viable company,” said Scott Sweet, a senior managing partner of advisory firm IPO Boutique.

“But they will have to concentrate on the smaller companies in that they’ve already packed their Fortune 500 clients with installations,” Sweet said, adding that the market for smaller companies was less competitive.

SolarWinds’ says its main competitors include Hewlett Packard Co (HPQ.N) International Business Machines Corp (IBM.N) and Cisco Systems (CSCO.O).

The company expects to begin trading on the New York Stock Exchange Wednesday under the symbol “SWI.”

The underwriters, led by JP Morgan (JPM.N) Goldman, Sachs & Co (GS.N) and Morgan Stanley (MS.N), have the option to buy another 1.8 million shares.

The last venture backed IPO in the United States was by Rackspace Hosting Inc (RAX.N) in August 2008, but its shares fell 20 percent in their debut.

(Reporting by Phil Wahba; Editing by Gary Hill)

peHUB note: The company has raised around $48.5 million in VC funding from Bain Capital Ventures (31.6% pre-IPO stake), Insight Venture Partners (31.6%) and Austin Ventures (3.4%).

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