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Nasdaq douses IPOs
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October 11, 2000: 5:12 p.m. ET
Human resources consulting firm opens to moderate gain; Pozen inches up
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NEW YORK (CNNfn) - The slumping Nasdaq stock market took its toll on the IPO market Wednesday with only one new issue -- Watson Wyatt & Co. Holdings -- trading significantly above its offer price.
Human resources consulting firm Watson Wyatt gained 23 percent, drug development company Pozen Inc. inched up 1.2 percent while W-H Energy Services Inc. dropped 10 percent.
The Nasdaq took a dive Wednesday after a trio of financial disappointments from Yahoo! (YHOO: Research, Estimates), Motorola Inc. (MOT: Research, Estimates) and Lucent Technologies (LU: Research, Estimates) sent the composite spiraling.
"The Nasdaq is putting a damper on the IPO market," said Corey Ostman, co-CEO of Alert-IPO.com. "If the Nasdaq were up 100 points and these deals came around then, they would trade higher."
 Watson Wyatt rose $3.88 to $16.38 after raising $70 million Tuesday. The firm sold 5.6 million shares at $12.50 per share, the midpoint of its expected $11.50 to $13.50 range, via underwriters led by DB Alex. Brown.
Bethesda, Md.-based Watson Wyatt is one of the "big four" human resource consulting firms and competes with such firms as William Mercer and Towers Perrin. Watson also includes Andersen Consulting as a rival in the technology consulting space.
Watson Wyatt CEO John J. Haley told CNNfn.com his company went public to attract and keep talent with options packages, to further strengthen the company's financial position and as currency for potential acquisition.
Haley said Watson Wyatt advises companies to use benefits as a way of keeping top employees, so offering options is really a "practice what we preach" plan.
He said while Watson Wyatt does not have its sights set on any acquisition targets, the company will be looking for businesses of appropriate size and quality which share the same values and aspirations.
"Most deals are made or broken on the cultural fit and the people," Haley said.
Read more bout Watson Wyatt in CNNfn.com's IPO Focus story
The 54-year-old firm is profitable, with net income of $18.5 million on revenue of $624.6 million for the year ended June 30. Watson Wyatt (WW: Research, Estimates) caters to large corporations such as General Electric (GE: Research, Estimates), General Motors (GM: Research, Estimates) and IBM (IBM: Research, Estimates).
A heady company
Chapel Hill, N.C.-based Pozen Inc. inched up 25 cents to $15.25.
Drug development company Pozen (POZN: Research, Estimates) raised $75 million after selling 5 million shares at $15 each via underwriters US Bancorp Piper Jaffrey.
Pozen's two major products, MT 100 and MT 300, are drugs that can be taken orally or injected to treat migraines. The development-stage company had net losses of $9 million on operating expenses of $9.3 million for the first half of 2000.
Oil field services company W-H Energy Services Inc. fell $2.25, or 14 percent, to $14.25. W-H Energy raised $165 million Tuesday, ahead of its IPO, after selling 10 million shares at $16.50, the bottom of its $16.50 to $18.50 price range, via underwriters led by Credit Suisse First Boston and Morgan Stanley Dean Witter.
Houston-based W-H Energy (WHES: Research, Estimates) offers products and services for the drilling and production of oil and natural gas wells.
High oil prices have provided a boost for oil- and gas-related IPOs. On Sept. 19, drilling rig company Chiles Offshore LLC climbed 11 percent in its market debut.
Lastly, SFBC International Inc., a provider of contract clinical research services, had yet to begin trading Wednesday. SFBC sold 1.25 million shares at $8 each via underwriters H.D. Brous. The company is expected to trade under "SFC" on the American Stock Exchange. 
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Watson Wyatt
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