Broadsoft Off to Shaky Start on Wall Street

VoIP application provider Broadsoft (BSFT) on Wednesday priced its initial public offering at $9, the low end of the expected range, and then watched its shares sink more than 6 percent.

Broadsoft raked in a mere $67.5 million from its IPO, substantially less than the $103.5 million company earlier this year had hoped to raise. The Gaithersburg, Md., company itself sold 5 million shares while stockholders sold 2.5 million. Underwriters Goldman Sachs and Jefferies & Co. may buy another 1.1 million shares to cover excess demand for the stock, Broadsoft said.

The disappointing activity indicates sluggish demand for stock offered by IP software developers. It also seems to reflect a dip in tech-sector IPO enthusiasm, which hit a two-year high in March.

Broadsoft said in a June 16 filing with the Securities and Exchange Commission it expects net proceeds to total $40 million. About $4.3 million of that will be used to redeem preferred shares and another $14.3 million will pay down debt. The rest of the money will fund working capital and other general corporate purposes. Broadsoft said that could include mergers and acquisitions but that no agreements for such transactions are in place.

At 1:55 p.m. Eastern, shares of Broadsoft were down 55 cents, or 6.11 percent, to $8.45.

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