Beceem Files for IPO As 4G-Products Demand Soars

Demand for 4G network-access is so hot that Beceem Communications Inc. wants to cash in.

The mobile broadband chipmaker announced its go-public intent in an April 2 filing with the Securities and Exchange Commission and said it hopes to make up to $100 million from the initial public offering. The IPO will take place “as soon as practicable,” Beceem told the SEC.

Beceem is at least the third communications-industry company to hit Wall Street so far this year, in a sign that the tech sector’s IPO drought may be near an end. Just last month, colo operator Telx and equipment vendor Force10 Networks said they’ll soon go public, while supplier Calix did, raising $82.3 million – more than analysts had expected.

Indeed, Beceem’s IPO timing looks smart. In 2009, shipments of mobile WiMAX chipsets reached 5 million, up from 1.3 million in 2008, according to research firm Maravedis. Until now, Beceem, founded in late 2003, has specialized in WiMAX semiconductors. But as more operators turn to the LTE standard, the company says it’s adding LTE chips to its product lineup.

Proceeds from the IPO should help Beceem forge ahead with its LTE plans. However, executives did not specify what they want to do with investors’ money. They said funds most likely will go toward working capital, sales and marketing, general and administrative expenses, and R&D. Beceem also told the SEC it could use the cash for mergers and takeovers. But, it added, “we have no agreements or commitments with respect to any acquisitions at this time.”

Stockholders also shouldn’t look for dividends from Beceem. The company said it will keep all available funds and future earnings to support operations and growth. “We do not intend to pay cash dividends on our common stock for the foreseeable future,” Beceem said in its SEC filing.

Last year, Beceem recorded $16.9 million in losses and $43.6 million in sales. Each of those numbers represented marked improvements from the prior two years. Service providers Comcast Corp. (CMCSA), Clearwire Corp. (CLWR) and KDDI (KDDIF.PK) rank among Beceem’s top customers, while Intel Corp. (INTC) is a key investor. But handset manufacturer Motorola Inc. (MOT) and semiconductor wholesaler Uniquest Corp. made up 51 percent and 12 percent, respectively, of Beceem’s 2009 revenue.

Beceem, based in Santa Clara, Calif., has applied to trade on the Nasdaq stock exchange under the ‘BECM’ ticker symbol. J.P. Morgan and Barclays Capital are underwriting the IPO.


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