Capital Markets

Quark IPO Doesn’t Exist — Yet

The biotech company cancels its IPO as a volatile week on Wall Street sends some, but not all, potential issuers scattering.
Stephen TaubJuly 30, 2007

The market’s recent heavy volatility and sharp downturn late last week are starting to impact the new issues market. Quark Pharmaceuticals Inc. Friday withdrew its registration for an initial public offering of common stock, according to a filing with the Securities and Exchange Commission.

Calling the offering a “discretionary financing,” the company explained in its filing that, “The terms currently obtainable in the public marketplace are not sufficiently attractiveÂÂ…to warrant proceeding with the public offering at this time.”

Quark, which in June changed its name from Quark Biotech, initially hoped to offer five million shares for between $12 and $14 per share. In its filing with the SEC, the company described itself as a clinical-stage biopharmaceutical company. It said it had two product candidates in clinical development, one for the treatment of wet age-related macular degeneration, and one for the prevention of acute renal failure.

If the market continues to swing wildly, other companies could cancel, or postpone their IPOs. Indeed, on Friday officials at buyout giant Kohlberg Kravis Roberts & Co. hinted that they may postpone the company’s plans to go public, noted The Wall Street Journal.

Nevertheless, other new issues seemed unaffected by last week’s market volatility, according to a report in Monday’s Journal. For example, shares of Perfect World Co., an online gaming company, rocketed 28 percent on its first day of trading. Furthermore, shares of BladeLogic Inc. and lululemon athletica soared 47 percent and 56 percent, respectively, on their first days.