MaxLinear IPO Prices Stock Above Range at $14 a Share

What began as a modest IPO for Carlsbad, CA-based chipmaker MaxLinear appears to be heating up. In a statement released tonight that MaxLinear increased its initial offering to 6.4 million shares at $14 a share—from 5.4 million shares at a range of $11 to $13 a share. The new stock offering is one of six IPOs expected this week, which has market watchers buzzing about the busiest week for IPOs in a couple of years. The company’s shares will trade on the New York Stock Exchange under the ticker symbol MXL (NYSE: [[ticker:MXL]]).

A number of forces have converged to make the MaxLinear IPO hotter than most. MaxLinear focuses on designing semiconductor chips that enable people to watch TV on devices with a wireless broadband connection. The company’s offering also comes during an auspicious week in the markets. Financial Engines, an investment adviser based in Palo Alto, CA pulled off the biggest IPO since the fall of 2009 when it went public last week.The S&P 500 Index has also reached its highest trading level since September. Market analysts have been saying that MaxLinear’s IPO, like the Financial Engines IPO last week, is over-subscribed.

As I mentioned in a preview of MaxLinear’s IPO, the company initially expected to raise $42.7 million, or nearly $50 million, if the underwriters exercise over-allotments that could bring the total offering to 6.25 million shares. With the last-minute increase to 6.4 million shares, MaxLinear’s offering is expected to raise close to $90 million.

The company’s filing showed that about 1.27 million shares, or 27 percent of the initial offering, are being sold by MaxLinear’s venture investors, which include San Diego’s Mission Ventures, (which owns a 13 percent pre-IPO stake); U.S. Venture Partners, (21.6 percent); Battery Ventures, (13.8 percent); and UMC Capital, (7.1 percent). The company plans to use the capital for general corporate purposes and acquisitions.

The Carlsbad chipmaker’s IPO also was stoked Monday evening by “Mad Money” pitchman Jim Cramer on CNBC. In his inimitable way, Cramer said, “MaxLinear is a play on many of the big themes that we’ve been hitting on all the time. The company designs high-performance, low-cost radio frequency receiver chips that capture and process broadband signals—which allows us to watch broadband video on cable boxes, digital TVs, mobile phones, computers, vehicle displays, and other networks. This is at the heart of the tsunami. Broadband video on your phone?! Oh man! That defines the tsunami!”

Author: Bruce V. Bigelow

In Memoriam: Our dear friend Bruce V. Bigelow passed away on June 29, 2018. He was the editor of Xconomy San Diego from 2008 to 2018. Read more about his life and work here. Bruce Bigelow joined Xconomy from the business desk of the San Diego Union-Tribune. He was a member of the team of reporters who were awarded the 2006 Pulitzer Prize in National Reporting for uncovering bribes paid to San Diego Republican Rep. Randy “Duke” Cunningham in exchange for special legislation earmarks. He also shared a 2006 award for enterprise reporting from the Society of Business Editors and Writers for “In Harm’s Way,” an article about the extraordinary casualty rate among employees working in Iraq for San Diego’s Titan Corp. He has written extensively about the 2002 corporate accounting scandal at software goliath Peregrine Systems. He also was a Gerald Loeb Award finalist and National Headline Award winner for “The Toymaker,” a 14-part chronicle of a San Diego start-up company. He takes special satisfaction, though, that the series was included in the library for nonfiction narrative journalism at the Nieman Foundation for Journalism at Harvard University. Bigelow graduated from U.C. Berkeley in 1977 with a degree in English Literature and from the Columbia University Graduate School of Journalism in 1979. Before joining the Union-Tribune in 1990, he worked for the Associated Press in Los Angeles and The Kansas City Times.