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Metavante pulls IPO
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November 1, 2000: 5:42 p.m. ET
Financial services firm cites market, slow accounting segment
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NEW YORK (CNNfn) - With one of the week's most promising initial public offerings, Evergreen Solar Inc., already struggled to price, the IPO market took another hit Wednesday as highly-touted Metavante Corp. withdrew its offering.
Metavante, which provides a wide range of electronic and Web financial services, originally planned to raise $200 million, but decreased its price range twice before pulling out altogether Wednesday.
Metavante's parent company, Marshall & Ilsey Corp. (MI: Research, Estimates), said it decided to withdraw the IPO because of adverse market conditions and near-term slowdown in its financial accounts processing business.
"This has been a tough equity market as we all know, particularly difficult for the IPO market," said Gordon H. Gunnlaugsson, Marshall & Ilsey, chief financial officer. "As we look at the increased focus by the financial markets on the revenue line as opposed to the net income line, the nature of our book of business and the lengthening of the decision-making process in the sale cycle, we concluded that at this time it was better not to proceed with the offering of Metavante."
Metavante CEO Joseph Delgadillo said the company's potential customers were seeing a taking longer to make decisions about who they wanted to outsource with in recent months. That helped contribute to a revenue slowdown at Marshall & Ilsey during the recently-completed third quarter and hurt Metavante's prospects on its IPO road show.
However, Delgadillo said the company's pipeline of potential customers remains very strong.
"The long-term prospects for this company in terms of pipeline activity and prospects is very, very strong," he said. "Some delays have occurred that in combination with the other factors caused us to reevaluate the timing of IPOing the company."
"While this may be a short term disappointment, I will tell you people are very, very fired up about the future prospects," Gunnlaugsson agreed. "We had the misfortune of hitting a market that really stinks. We weren't the least bit happy by having to cut twice the indicated range for the IPO offering."
Brown Deer, Wis.-based Metavante targets primarily the financial services industry, catering to clients such as Washington Mutual Inc. (WM: Research, Estimates), FleetBoston Financial Corp. (FBF: Research, Estimates), Bank of America Corp. (BAC: Research, Estimates), and its parent company.
Metavante earned revenue of $289 million on net income of $20.6 million for the six months ended June 30. The company planned to trade as "MVNT" on the Nasdaq, and the lead underwriter was Donaldson Lufkin and Jenrette.
Company officials would not comment on the prospects of future filing to take Metavante public. 
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Metavante
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