Charlotte's Web: We're Not for Sale
Charlotte’s Web Networks, a terabit routing startup based in Israel, denies rumors reported on the Web site TheMarker.com that it's on the verge of being acquired. But in doing so it has also let slip its plans for an IPO.
"We flatly deny being in any negotiations with a view to an acquisition," says Gideon Kaempfer, the CTO of Charlotte's Web. "We are continuing our fund raising as planned. And we are building the company towards an IPO for Q3 next year."
TheMarker.com, which covers local Israeli technology news, reported Sunday that MRV Communications Inc. (Nasdaq: MRVC), a majority shareholder in the company, had altered its plans to invest in Charlotte's second round of funding, which raised suspicions that the startup was preparing to be sold.
According to filings with the Securities and Exchange Commission, MRV had planned a huge contribution to the second round of financing but pulled back. The company had registered a request to sell one million additional shares of its stock to finance about half of Charlotte’s targeted $50-million second round, says the article. But a second prospectus filed with the SEC two weeks later did not mention the additional shares at all.
MRV has confirmed that the company was planning to issue more stock to help finance the second-round funding for Charlotte’s Web. But instead of selling off more shares, the company decided to contribute less cash and add new strategic investors to the round of funding. MRV won't say who those investors are.
-- Marguerite Reardon, senior editor, Light Reading, http://www.lightreading.com