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Infineon, Europe’s second largest semiconductor maker, raised $546m on Wednesday with the New York listing of Qimonda, its memory chip unit, after being forced to slash the size of the offering and cut its price.
The European group cited challenging market conditions and uncertain sentiment for its decision to scale back the initial public offering. Qimonda’s shares closed at $13.53 in New York, up 4 per cent on the IPO price of $13. Even at its reduced size, Qimonda was the largest initial public offering by a non-US company on the New York Stock Exchange this year.
US exchanges have struggled to attract foreign listings with companies choosing to float in their home markets, citing concerns about the regulatory regime in the US.
Only one of the 10 biggest global IPOs this year has taken place in the US: Mastercard’s float on the NYSE.
Dealogic, the research firm, said that none of last year’s 25 largest international IPOs, in terms of the amount of money raised was listed on the NYSE or the Nasdaq stock market.
Infineon cut the price from an initial range of $16-$18 to $13 late on Tuesday and reduced the number of shares being offered from 63m to 42m. It also reduced the over-allotment option to 6.3m shares from 9.45m.
A raft of companies have chosen to withdraw or postpone planned IPOs in the US, citing uncertain market conditions.
Kin Wah Loh, chief executive officer of Qimonda, said the company went ahead with the offering, in spite of the challenging environment, because “there is not necessarily a good or bad time to float”. He added: “You weigh the pros and cons, make the decision to float, execute and adjust to market conditions. In this challenging environment, we thought $13 was a fair price.”
Qimonda only recently moved back into profit, thanks to a recovery in memory chip prices, which had fallen sharply in the previous year and a half.
The listing marks an attempt by Infineon to withdraw from the cyclical market for so-called D-Ram computer chips.The Munich-based company span off Qimonda in May last year.
It wants to focus on higher-margin logic chips, in cars or telephones, and will use some of the proceeds from the IPO for this.
Infineon had considered listing in Asia but chose New York in May, hoping that Micron Technologies, a NYSE-listed rival, would give investors a useful comparison when assessing Qimonda stock.