Massachusetts-based wind power developer First Wind Holdings pulled plans for an initial public offering just hours before the company’s stock was due to begin trading on the Nasdaq last Thursday.
Initially the company wanted to sell roughly 12 million shares in a price range of $24 to $26 each, which would have raised as much as $312 million.
A lowered price range of $18 to $20 was announced Wednesday morning, with trading set to begin on Thursday. But apparently the underwriters were not willing to match even the lowered price range in final negotiations, according to a Boston Globe story.
“While we received significant interest from potential investors during the marketing of our IPO, the terms that the IPO market was seeking at this time were not attractive to the company,’’ First Wind CEO Paul Gaynor said in a yesterday.
Investors may be uneasy with First Wind, because the firm holds more than $500 million in long-term debt and has lost money each of the last two years–$64.3 million in 2008 and $57.1 million in 2009.
However the company said in March it had assets of $1.7 billion–including $31.4 million in cash.
Earlier this year First Wind received a $117 million loan guarantee from the Department of Energy to build a 30-megawatts (MW) wind farm in Hawaii.
The company also has completed the first 200 MW phase of a Utah wind farm that supplies power to the city of Los Angeles. And they are expanding the Stetson Wind project, which was the first utility-scale wind farm in Maine.
Globe columnist Steven Spyre suggest that alternative energy firms like First Wind are being squeezed by a combination of low fossil fuel prices, reduced electricity demand and the possible elimination of federal tax incentives. Read his take at the link below.
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