IPO braveheart eyes Euro expansion

Nasdaq newcomer Lawson Software saw its shares fall by 1.39 per cent in early trading today following its upbeat debut last week.

Trading in the shares of the professional services software company, one of the few technology companies to IPO in the past six months, surprised analysts on Friday. Its stock jumped 13 per cent on the initial $14 offering price.

Analysts suggest the IPO, which has been in the pipeline for over a year, will finance the company's expansion into Europe.

Dennis Byron, US-based programme research director with IDC, said: "Lawson has had little penetration outside of the US, its worldwide strategy is basically a North-American strategy."

Considered a top-tier player in the US, Lawson is often pitched against international names such as JD Edwards, Oracle and Peoplesoft.

However, despite broadening its ERP and HR software offerings to include professional service automation and an increased focus on vertical markets such as finance, healthcare, and retail, the company has so far failed to dent the west-European market.

While Lawson declined to comment on the IPO, citing a regulatory quiet period, an SEC filing outlined plans to use capital raised from the IPO for future acquisitions and expansion.

Bill Clough, research manager of the European software group at IDC, said a move into western Europe could be on the cards.

He said that while the IPO might give the company the green light to expand into Europe, US customers who burnt their fingers in the dot-com downturn will be cautious.

He told silicon.com: "I don't know if it will do a lot for them in the US. There is still a lot of resonance from the dot-com crash, people think if you go to market, you're just looking to investors for money to burn."

Lawson issued 14 million shares at $14 per share, reduced from an earlier price range of $15 to $17, and will trade on Nasdaq under the symbol LWSN.