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Home > Nanotechnology Columns > Alan Shalleck-NanoClarity > The Unique NanoDynamics IPO: A Model for Other Nanotech IPO's

Alan Shalleck
President
NanoClarity LLC

Abstract:
The second nanotechnology IPO, NanoDynamics, Inc. (ND) is underway. Yes, NanoDynamics is finally going public … even in this worldwide down market, and insiders tell me it is already a successful offering. This ND IPO is unique and can serve as a model for other nanotech company managers thinking about raising money in the public marketplace. Why? Because NanoDynamics is going public on the deal hungry Dubai Exchange, not here in the US, and will be the first US company IPO on that exchange! Pretty creative, eh? This is one smart management team.

January 22nd, 2008

The Unique NanoDynamics IPO: A Model for Other Nanotech IPO's

The Unique NanoDynamics IPO
A Model for Other Nanotech IPO's
By
Alan B. Shalleck
NanoClarity LLC
January 2008


The second nanotechnology IPO, NanoDynamics, Inc. (ND) is underway. Yes, NanoDynamics is finally going public … even in this worldwide down market, and insiders tell me it is already a successful offering. This ND IPO is unique and can serve as a model for other nanotech company managers thinking about raising money in the public marketplace. Why? Because NanoDynamics is going public on the deal hungry Dubai Exchange, not here in the US, and will be the first US company IPO on that exchange! Pretty creative, eh? This is one smart management team.

With US markets returning to extraordinary volatility, the domestic climate for US nanotech company IPO's obviously has returned to unfavorable. However, in a global financial marketplace there are other exchanges worldwide in which big money invest and is looking for long-term companies with strategic technology and positioning. There are the AIM (Alternative Investment Market) in London and now the Dubai International Financial (DIFX) Exchanges. Both are open to approaches by US high tech companies. The Dubai exchange however is new and hungry, searching for a worldwide presence and influence, and to carry the stocks of hot companies. The money investing on the exchange is all offshore money and with oil and commodities incredibly high, large amounts of funding are looking for investment opportunities. Nanotech seems to have caught the interests of many of these investors and the opportunities for nanotech IPO's are growing on that exchange.

In February, the Dubai exchange will be renamed the NASDAQ-DIFX because NASDAQ has taken a 20% stake in the Dubai exchange while the Dubai exchange has taken a similar stake in the NASDAQ allowing the Dubai exchange to carry the NASDAQ name. By going public on the DIFX, a nanotech company can be listed, after February, on the international portion of the NASDAQ and be traded on the NASDAQ exchange. It is a 2008 way to go public and obtain investors from outside the US where the new money is accumulating in amazing amounts. The disadvantage is that US citizens will not directly be able to own public stock in any company IPO'ing and listing on the Dubai Exchange. Note that detail has yet to stop any investor who seriously wants to own stock in any company worldwide.

NanoDynamics's investment bankers discussed with ND management the option of going public on the DIFX after the first S-1 was withdrawn during the late Fall. Although rumors were circulating that ND was going public by yearend, little was mentioned as to where the IPO would be floated. Dubai was on no one's radar. When ND said, "yes," the IPO became the first high technology US company to IPO and plan to be listed solely on the NASDAQ-DIFX.

The ND IPO may not reach the $100 million size that the US S-1 described. It may only be between $50 million and $75 million. That does not matter because ND has obtained private money between the filed S-1 and now. ND claims that most of the institutional buyers are committed and that the amounts for the general investor are oversubscribed. The deal should be priced in two weeks and be trading by February 1. Because many of the ND applications for its nanotech water filters and fuel cells are in third world nations and the Far East, going public on the Dubai exchange makes strategic business sense for ND. In addition, a series of green applications for specific versions of ND's developments will be coming to technical and economic fruition during the spring. These opportunities will provide an immediate income boost to ND. Clearly, the managers of ND are some of the brightest and most creative businessmen in the nanotech industry.

What does the ND IPO model mean for the rest of the Nanotech industry? It represents an open path to public financing that is not being offered by US investment bankers or brokerages. Looking beyond the US shores is now an option for a maturing, funds starved, nanotech company that is on the edge of market and sales development.

Last month I recommended a 2008 strategy of nanotech company consolidation. Consolidate or die. This month I have exposed the second part of my recommended strategy. The reason to merge is first to create a critical operational mass and second to go public on the NASDAQ-DIFX exchange to finance your next growth stage. ND is leading the way… follow them while international big money is looking for US technology and for US based growing nanotech companies.


Alan B. Shalleck
NanoClarity LLC
www.nanoclarity.com


© NanoClarity LLC 2008



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