Shares of MedAssets closed sharply higher on Thursday as the company sold its initial public offering of stock.
MedAsset shares closed at $20.50 in trading on Dec. 13, up 28 percent from the opening price of $16 per share. Some 6.2 million shares traded hands. The stock's price ranged from $19.28 to $21 per share.
The initial public offering involved 13.3 million shares of stock. The company sold the stock and realized about $195 million from the sale, after fees and expenses.
The company and certain stockholders have given underwriters for the offering an option for 30 days to purchase an additional 1,995,000 shares of common stock at the original price of the initial public offering.
Based on the final closing price on Thursday, all of MedAssets' nearly 43 million shares - which include those still held by the company and individuals - give it a total market capitalization of about $880 million.
The stock trades on the NASDAQ Global Select Market under the trading symbol MDAS.
Alpharetta, Ga.-based MedAssets makes revenue and expense management software for hospitals. MedAssets contends that its applications can improve operating margins for stand-alone and system-owned hospitals. Other MedAsset services are designed to help control supply costs for facilities.
The company said it intends to use the net proceeds of the offering to repay approximately $125 million of debt and for general corporate purposes, including "further development and expansion of its technology enabled solutions, and for possible acquisitions of complementary businesses, technologies or other assets.
For the nine months ended Sept. 30, MedAssets' earnings fell to $6.4 million, from $6.9 million in the nine months ended Sept. 30, 2006. Revenue for the first nine months of 2007 grew to $134.6 million, compared with $109.2 million over the same period in 2006.
Participating investment banking firms in the offering included Morgan Stanley, Lehman Brothers, Deutsche Bank Securities, Goldman Sachs, Piper Jaffray, William Blair & Co. and Wachovia Capital Markets.