Perot Systems Surges On Debut

By CBSNews.com staff CBSNews.com staff

February 1, 1999 / 3:10 PM EST / CBS

Shares of Perot Systems Inc., the high-tech computer services company started by billionaire Ross Perot, surged in the company's initial public offering Tuesday.

The stock, which began trading on the New York Stock Exchange under the symbol PER, closed at $42.50.

In late morning, trading was halted due to an imbalance between buyers and sellers, after shares had soared $17.75 points to $33.75 at the opening.

The two-time presidential candidate's company on Monday sold 6.5 million shares at $16 each in an initial public offering of stock with underwriters.

Dallas-based Perot Systems originally expected to sell 5.5 million shares at $11 to $12 each, according to the company's earlier IPO filings.

Not that he needs the extra dough, but Perot stands to get much richer from the offering. He owns 31.7 million shares of the company.

Morgan Stanley Dean Witter is the lead underwriter.

MedE America (MEDE), a health care software developer, has also priced its offering. The company sold 4.9 million shares at $13, at the low end of the original $13 to $15 range, via lead underwriter Salomon Smith Barney. The company, which says it processes more than 900,000 claims transactions per day, raised the number of shares in the deal from 3.6 million.

MedE first filed for an IPO way back in June of last year.

Perot and MedE will be followed by a number of anticipated deals. General Motors' (GM) spin-off Delphi Automotive Systems should provide the U.S. IPO market with its first billion-dollar plus deal of the year. The auto parts maker expects to sell 100 million shares at $15 to $18 each. Morgan Stanley is also at the helm of this deal.

Other deals to watch:

Interactive ad agency Modem Media Poppe Tyson, which plans to sell 2.6 million shares at $11 to $13, is expected to benefit from its Internet connections. However, the company hasn't yet boosted the terms of its IPO, which is being handled by BancBoston Robertson Stephens.

Two deals from Morgan Stanley are giving it a second attempt this week. Both Healtheon and Del Monte Foods, which couldn't complete deals planned last year, are tentatively slated to go public. Healtheon, a provider of Internet-based technology for health care providers, hasn't yet set the terms for its deal, while canned food king Del Monte looks to sell 18.8 million shares at $16 to $18.