Vyyo Stock Soars After Funding
Alan Breznick, Cable/Video Practice Leader, Light Reading
Shares of Vyyo Inc. (Nasdaq: VYYO) jumped almost 13 percent to $8.44 a share yesterday following the company's announcement that it will receive $35 million in new funding from Goldman, Sachs & Co.
Vyyo shares were still above $8 in early afternoon trading on Thursday. At the beginning of this month, they were trading around $4.30.
The financing will give Vyyo $17.5 million in new funding and another $17.5 million to pay off notes that were issued to Goldman Sachs last year. The $35 million consists of a five-year, unsecured note convertible into Vyyo's stock at $10 per share. The firm expects to close the deal within the week.
Vyyo said it will use the fresh funding to "accelerate deployment of its spectrum overlay and business services solutions for the cable industry." The company is promoting its 3GHz overlay technology as the answer to the industry's growing bandwidth woes.
Also yesterday, ThinkEquity LLC analyst Anton Wahlman raised his target price for Vyyo's stock, saying he's more bullish because of planned deployments and trials of the firm's technology by several major U.S. cable operators.
Wahlman predicted that "almost all cable operators will be deploying at least modest quantities for Vyyo equipment for enterprise applications" before the end of the year.
A Vyyo spokesman declined comment on the reports of new cable trials and deployments, which have been swirling around the company for weeks. The firm plans to report its fourth-quarter and year-end earnings results Monday morning.
— Alan Breznick, Site Editor, Cable Digital News