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Transmeta IPO on track
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November 2, 2000: 3:46 p.m. ET
Mobile chip firm's offering can still shine, despite IBM black eye
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NEW YORK (CNNfn) - Though IBM spurned Transmeta Corp.'s Crusoe microprocessor for an upcoming notebook, Transmeta's initial public offering is still on track for next week and should produce solid returns, according to analysts.
IBM's decision not to use Transmeta's mobile computing chip in its ThinkPad 240 without giving a specific reason puzzled many investors, especially considering that IBM physically manufactures and tests the Crusoe for Transmeta.
Message boards have filled with theories, ranging from assertions that Intel Corp. (INTC: Research, Estimates) influenced IBM's (IBM: Research, Estimates) decision to suspicions of a new alliance with Transmeta and Advanced Micro Devices (AMD: Research, Estimates).
But IPO analysts have not given up on what they continually describe as a very strong offering.
"This has taken a little polish off the apple, but it's still an apple," said John Fitzgibbon, IPO analysts with WorldFinanceNet.com.
The deal, originally slated for the week of Nov. 6, had so much buzz that it was brought forward a week in anticipation of strong demand. But on Sunday, Oct. 29, it was unexpectedly moved back to the original week.
Fitzgibbon said the pricing move was because the IBM announcement was coming down.
"They accelerated (the offering) because it was looking great," he said. "But if they had gone out this week they would have had a terrific first day, then the news would have hit and the stock would have fallen and they would have had to deal with a whole bunch of class actions."
Lead underwriters Morgan Stanley Dean Witter said they expect to price Transmeta's 13 million shares on Monday, Nov. 6, ready for trading the next day.
The company hopes to raise about $156 million pricing between $11 and $13. Santa Clara, Calif.-based Transmeta will trade as "TMTA" on the Nasdaq. 
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Transmeta
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