@Home Network Inc, the internet-over-cable pioneer has filed with the Securities and Exchange Commission for an initial public offering on Nasdaq 8 million shares, to raise about $64.4m. That’s a cheaper offering than the four investors, Motorola, Sun Microsystems, Bay Networks, Rogers Cablesystems and Shaw Communications got, when they paid $48m for about 4.5% of the company a month ago, valuing it at just over $1bn (CI No 3,142). The IPO represents about 7.4% of the company’s 108.6 million shares, putting its total value at about $760.2m. But investors will have to be patient. The company warned in its filing that it expects substantial operating losses in the near future after turning in net losses of about $24.5m last year, on revenues of just $676,000. For the first quarter this year the company posted net losses of $10.9m on revenues of $806,000. The proximity of the placement and this offering is perhaps an indication of how quickly building the network from scratch has burnt @Home’s cash. It has a deficit of $38.2m right now. @Home and its corporate arm, @Work, has a network that uses a combination of the cable television industry’s hybrid fiber-co-axial infrastructure and its own network architecture. But somewhat worringly, it has only managed to get about 5,000 subscribers in total across the 12 cities in which it is deployed. The cable modems are said to offer download speeds of up to 300 times that of typical dial-up connections. Initial investors were cable companies Tele- Communications Inc, Comcast Corp, Cox Communications and venture capitalists Kleiner Perkins Caufield & Byers. But the company has big ambitions for the @Work side of the business, which is where the real money probably lies. These include being an internet service provider, tele-commuting, hosting and multicasting. Underwriters are led by Morgan Stanley, Merrill Lynch, Alex Brown & Sons and Hambrecht & Quist. The proximity of the placement and this offering is perhaps an indication of how quickly building the network has burned @Home’s cash. á
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