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Carrier WiFi

Aruba Plots $80M IPO

Wireless LAN vendor Aruba Networks Inc. (Nasdaq: ARUN) has set the range for its IPO and is expecting to raise up to $80 million in a float on the Nasdaq .

The company, which unveiled its IPO plans last December, plans to sell 8 million shares at a price of $8 to $10 each, according to updated documents filed with the Securities and Exchange Commission (SEC) . (See Aruba Files for IPO.)

The firm plans to trade under the ticker symbol "ARUN." Aruba is expected to be priced Monday, March 26, to trade on Tuesday, March 27.

Aruba is one of the largest startups in the enterprise WLAN business. Most research firms rank it No. 3 after Cisco Systems Inc. (Nasdaq: CSCO) and Motorola Inc. (NYSE: MOT)'s enterprise unit (formerly Symbol).

Nonetheless, competing in any market where Cisco dominates can be a daunting and costly task. Aruba reveals in the latest filing that it took a net loss of $11.7 million on total revenues of $51.2 million for the six months ended January 31, 2007.

"We expect to incur operating losses in the future as a result of the expenses associated with the continued development and expansion of our business," Aruba notes.

The filing also provides insight into Aruba's OEM relationship with Alcatel-Lucent (NYSE: ALU). "For the fiscal year ended July 31, 2006 and the six months ended January 31, 2007, Alcatel-Lucent accounted for approximately 15 percent and 21 percent of our total revenues, respectively."

The nature of the relationship also gives Alcatel-Lucent approval rights on potential ties between Aruba and other vendors.

Despite recent market downturns, the competitive market, and the current lack of profits, John Fitzgibbon Jr., publisher of IPOScoop -- a site dedicated to tracking market flotations -- reckons Aruba and other technology IPOs should go well. "All these deals are hot," he comments.

Showing the way for such tech IPOs will be wireless broadband operator Clearwire LLC (Nasdaq: CLWR), which is expected to start trading today. The Kirkland, Wash.-based proto-WiMax operator could raise up to $500 million if the IPO stays within the range the company has set. (See Clearwire's Cash Craving.)

— Dan Jones, Site Editor, Unstrung

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