Originally published December 8 2005
Shares of iRobot Corp. soar after years of losses
by Mike Adams, the Health Ranger, NaturalNews Editor
iRobot makes mobile robots for the consumer market, and will soon come out with a mop called Scooba for hard floors. They also make Packbots for soldiers, which disarm roadside bombs.
Shares of iRobot Corp. closed up more than 11 per cent in yesterday's trading debut for the world's largest maker of mobile robots for the consumer market, from the floor-cleaning Roomba to the soldier-accompanying Packbot.
They rose as high as $34.16 in early trading before retreating to close up $2.70 at $26.70 on the Nasdaq Stock Market.
The offering, announced July 27, seeks to raise $120 million to finance growth at a company that is the world's largest in the fields of mobile robotics and consumer robots, as opposed to industrial robots used on factory floors.
iRobot granted the stock offering's underwriters -- a syndicate led by Morgan Stanley & Co. and J.P. Morgan Securities Inc. -- the right to buy another 645,000 shares at the initial price.
The 4.3 million shares offered to the public yesterday represent just 18 per cent of the company's 23.3 million shares outstanding, most of them held by insiders.
Based on the closing stock price, the company's market value is $621.8 million.
The IPO is seen as a test not only for iRobot but for an industry that has relied heavily on military contracts and venture capital.
"The technology wasn't ready prior to this," said Neena Buck, a technology analyst at Strategy Analytics Inc.
Its larger and more diversified competitors in the consumer arena include AB Electrolux, Alfred Karcher and Samsung Electronics.
Buck said iRobot also faces competition from makers of conventional vacuums, which are teaming up with robotics researchers to develop rivals to iRobot's three-year-old Roomba, the source of more than half the company's revenue.
iRobot was started by three colleagues at the Massachusetts Institute of Technology in 1990.
The 258-employee company has said in regulatory filings that it lost money from its inception through 2003, including losses of $10.8 million in 2002 and $7.4 million in 2003.
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