Lowered Expectations: Motricity Prices IPO

(Reuters) – Mobile Internet and data services seller Motricity Inc (MOTR.O) priced shares in its initial public offering at the bottom of the expected range and sold fewer shares than anticipated, according to an underwriter.

The company, which cut and delayed its IPO, sold 5 million shares for $10 each, raising about $50 million. It had planned to sell 5.87 million shares for $10 to $11 each, after cutting the expected value of its IPO by 39.1 percent.

The company had earlier filed to sell 6.75 million shares for $14 to $16 each and was originally expected to price on Wednesday night.

In the same filing with the cut terms Motricity said billionaire investor Carl Icahn, who controlled 18.5 percent of Motricity as of May 31, may purchase up to one million shares in connection with the IPO.

Motricity’s customers include major wireless providers Verizon Communications Inc (VZ.N), AT&T Inc (T.N), Sprint Nextel Corp (S.N) and T-Mobile. Shareholders include Icahn and funds affiliated with Advanced Equities, Technology Crossover Ventures and New Enterprise Associates.

Revenue grew 24.9 percent to $29.08 million in the three months ended March 31. The net loss attributable to common stockholders narrowed 38.8 percent to $7.93 million in the same period.

Motricity said it would use proceeds from the offering for technology investments and acquisitions.

Underwriters were led by JPMorgan and Goldman Sachs & Co. Shares are expected to begin trading on the Nasdaq on Friday under the symbol “MOTR.” (Reporting by Clare Baldwin; Editing by Bernard Orr)

peHUB Note: Motricity has raised over $365 million in VC funding, from Advanced Equities, Carl Icahn, New Enterprise Associates, Technology Crossover Ventures, Massey-Burch Capital, Noro-Moseley Partners, Intel Capital, Qualcomm Ventures, Sienna Ventures, TriState Investment Group and Wakefield Group.