Rambus Inc, Mountain View, California developer of high-speed memory chip interface technology, launched its initial public offering of 2.75 million common shares – representing a 12.8% stake – Wednesday at $12 per share. That target was upped Monday from $10 but Rambus still got far more than it bargained for as the shares promptly took off for the stratosphere, closing on the day’s high of $30.25 on trading volume of over five million. Rambus believes that it will define the next generation of computer memory chips with a technology which it says will speed up the graphics-handling capacity of the desktop by up to four times current speeds. Wall Street seems to agree with its claims. Even Morgan Stanley & Co, lead underwriter for the offering, underestimated the appeal of the stock when it predicted it would jump about 10% upon hitting the market, quite a distance from the 150% upward surge it made, easily becoming the day’s most advanced share. Rambus thinks that its technology will eventually dominate the market for main memory chips, and has a list of financial backers that includes Bill Gates and Michael Dell. The company has a deal with Intel Corp to develop its technology for use in Intel chips. The deal reportedly gives Intel the right to buy up to a million Rambus shares at $10 a share – a price which, in one afternoon, became a huge bargain.
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