NeoPhotonics IPO Soars After Pricing At $11 Apiece

NEW YORK (AP) - Shares of NeoPhotonics Corp. soared Wednesday after the circuit maker expanded its initial public offering and priced shares at $11 apiece, the high end of its expected range.

Shares of the company gained $3.01, or 27 percent, to $14.01 in afternoon trading on the New York Stock Exchange under the ticker "NPTN."

NeoPhotonics sells circuits to heavyweights such as Cisco Systems Inc. and Alcatel-Lucent SA, which use these chips to make networking gear. Its products help networks run smoothly even if they are loaded with traffic from websites like Hulu, where people watch bandwidth-heavy videos, and Skype, where they use video chat services.

The company is betting that as Internet users' appetite for online video grows, there will be an increase in demand for equipment that companies can use to keep networks from getting bogged down.

NeoPhotonics was founded in 1996 as NanoGram Corp. and changed its name in 2002. Though it's based in San Jose, Calif., it has a factory in Shenzhen, China. Its investors include venture capital firms Oak Investment Partners and Draper Fisher Jurvetson.

The offering includes 7.5 million shares, valuing the offering at $82.5 million before expenses. Previously, NeoPhotonics said it expected to sell 7 million shares, priced between $9 and $11 apiece.

The company said in a regulatory filing it plans to use the proceeds from its IPO for working capital, general corporate purposes, to expand its business and it may also use it to repay debt.

The underwriters include Bank of America Merrill Lynch, Deutsche Bank Securities, Morgan Keegan, Piper Jaffray and ThinkEquity.