Boston, MA 06/12/2014 (wallstreetpr) – Designer of communications integrated circuits for network equipments, Vitesse Semiconductor Corporation (NYSE:VTSS) announced a public issue of its shares, which is fully underwritten. The company intends to announce the pricing of the shares on June 12.
Public Issue
The proposed public issue will be managed by Needham & Company, LLC for book runner and co-managed by Northland Securities, Inc., The Benchmark Company, LLC and Craig-Hallum Capital Group LLC.
The company plans to make use of the net proceeds from the public issue for its working capital and for general corporate purposes. Vitesse said that the shares are offered following a registration statement filed earlier and declared effective subsequently by the Securities and Exchange Commission or SEC.
Vitesse Semiconductor Corporation (NYSE:VTSS) also plans to file a preliminary prospectus supplement in relation to the public issue with the SEC.
Market Reaction
The market reacted unfavorably to Vitesse announcement of a public issue by dragging down the stock over 9% at one point of time in the extended hours of trading on June 11. A gain of 4.66% recorded while the regular market was on, was completely wiped out. The trend is likely to extend to Thursday morning when the normal trading resumes.
The stock had hit a year of $4.69 and a low of $2.23 during the last one year period.
Expectations
Vitesse Semiconductor Corporation (NYSE:VTSS) has been incurring losses during the last four quarters. The worst factor is that its loss in the second quarter was wider than the first quarter of the current fiscal year. It suffered a loss of 7 cents a share for the second quarter, wider than 4 cents a share in the first quarter of the fiscal 2014. The loss per share is wider than analysts’ expectations by a cent. However, in the preceding three quarters, its losses were narrower than analysts’ predictions.
For the third quarter too, Street is expecting Vitesse to incur a loss of 3 cents a share compared to the 13 cents in the second quarter of 2013.
