Agere Systems Inc. (Allentown, PA), a subsidiary about to be spun off from Lucent Technologies Inc. (Murray Hill, NJ), has lowered the range of its upcoming initial public offering to $12 to $14 per share. The decrease from a previous range of $16 to $19 per share was revealed in a filing with the Securities and Exchange Commission.
Agere plans to offer about one-third more shares to the public to keep its net proceeds from the offering the same, about $3.75 billion. Including a large amount of preferred stock that will go to parent Lucent, Agere will have a total of 1.34 billion shares outstanding, giving it an initial market capitalization of as much as $18.7 billion. That figure could have gone as high as $25.4 billion, if the initial offering price had successfully been made at $19 per share.
According to the prospectus, Agere filed Monday with the SEC. A total of 500 million new Agere shares will be made available in the IPO, with Agere selling 300 million of them through several underwriters. Those underwriters will have the option to sell an additional 75 million shares, if needed, to cover over-allotments.
"The decision is based on the current conditions in the stock market and Agere's industry sectors," said Lucent spokeswoman Michelle Davidson. She added, "We're moving forward on schedule to have the IPO at the end of March and Agere becoming a completely independent company by September."