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Luna Innovations, Inc. (LUNA) went public on Friday, raising $21 million through the sale of 3.5 million shares at $6 per share. This was down considerably from the $57.5 million that the company was looking to raise when it filed its initial S-1 on February 10, 2006. When the deal was first priced on April 28, the company was still hoping to sell 4 million shares in the price range of $11 to $13 per share.
They should have taken this company public a year ago. The company had a disappointing 2005 (revenues from product sales and licensing agreements dried up), followed by a disappointing first quarter in 2006. I am not suggesting that the stock is a buy at current levels. It is, however, a company with an interesting business plan that bears watching. Eventually, the nanotechnology sector will heat up again.
From the S-1:
We research, develop and commercialize innovative technologies in two primary areas: molecular technology solutions and sensing solutions. We have a disciplined and integrated business model that is designed to accelerate the process of bringing new and innovative products to market. We identify technologies that can fulfill identified market needs and then take these technologies from the applied research stage through commercialization in our two areas of focus:
Molecular Technology Solutions. We develop molecular technology solutions, which are substances and materials with enhanced performance characteristics obtained by harnessing chemical, physical and biological properties of novel combinations of matter. We focus on substances and materials at the molecular level, including nanomaterials, which are materials whose size can be measured in nanometers, or one billionth of a meter. Examples of our solutions in this area include flame retardants, protective coatings, and materials that can help physicians identify diseased tissues using magnetic resonance imaging, or MRI.
Sensing Solutions. We develop integrated sensing solutions, which are products that combine sensors, software and hardware to measure, monitor and control chemical, physical and biological properties. We have particular expertise in optical, acoustic and wireless technologies. Examples of our solutions in this area include medical monitoring products and industrial instrumentation for aerospace, energy generation and distribution, and defense applications.
We have a successful track record in executing our market-driven business model. Since our inception, we have developed more than a dozen products serving various industries including energy, telecommunications, life sciences and defense. We have created five companies in our areas of focus, sold two of them to industry leaders in their fields, raised private capital for two of our companies, formed one joint venture and entered into four licensing agreements.
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