serves up Hawaiian
punch in debut
The Internet firm's 458% gainBy Russ Lynch
is the fourth-largest first-day gain ever
One of Wall Street's hottest initial public offerings put the Hawaiian word "akamai" into stock market headlines today, bringing out a variety of explanations of how to pronounce it and what it means.
The occasion was the IPO of Akamai Technologies Inc., based in Cambridge, Mass. The IPO was priced at $26 by underwriters late yesterday, raising $234 million for the company, which found a new way to speed up data transmission on the Internet.
Trading under the symbol "AKAM," it opened at $110 in its first Nasdaq stock market transaction today. It soared as high as $166 and closed at $145.19, more than five times what the initial institutional buyers paid for it late yesterday and up more than $35, or 32 percent, in the day's public trading. More than 11 million of its shares changed hands.
The stock closed at 458 percent gain from yesterday's initial price of $26; however, the general public could not buy it as low as the underwriters' price, and investors who bought at its peak price today lost money on paper.
Still, Akamai's rise of more than $119 was the fourth biggest gain for a U.S. stock in first-day trading.
The company's name, meanwhile, provided for a bit of confusion.
Bloomberg News provided this explanation of the name: "Akamai -- pronounced "ACK-a-my,' a Hawaiian word that means clever or cool." Well, no, not "ACK."
The company itself says it should be pronounced "AH kuh my." At least the pronunciation of each syllable is correct that way, but one native Hawaiian told the Star-Bulletin that the emphasis should be on the last syllable.
The Hawaiian Dictionary, by Mary Kawena Pukui and Samuel H. Elbert, which doesn't detail the pronunciation, defines the word as "smart, clever, expert; smartness, skill."
But no "cool."
Company officials, busy with the IPO, said today there is no Hawaii connection with any of the founders and nothing Hawaiian about the company. The company simply used a search engine to find words that meant "smart" or "clever," came across "akamai" and liked it, said a spokeswoman Caryn Converse.
The company was founded last year by Thomson Leighton, now 42, a professor of applied mathematics at Massachusetts Institute of Technology who is on sabbatical, and Daniel Lewin, now 29, a Ph.D candidate at MIT.
They found a way through mathematical algorithms to manage data movement on the Internet through hundreds of different servers, applying formulae that ferret out the least-trafficked sites and move information through them.
Akamai sells FreeFlow, which links 1,475 computer servers in 24 countries through 55 telecommunications networks. Companies such as Yahoo! Inc. and CNN.com place their content on those servers. Akamai says it transmits data two to 10 times faster than Yahoo because it routs transmissions around busy points of the Internet.
The company had $1.29 million in revenues in the nine months ending Sept. 30, mostly from contracts with Apple Computer Inc. and Yahoo, and lost $28.3 million before paying deferred stock dividends.
Akamai now does have one legitimate Hawaii connection. A Honolulu company, NetEnterprise Inc., which offers high-bandwidth Internet capacity through its data center in downtown Honolulu, said Akamai has joined its system.
Akamai will locate some of its FreeFlow servers at NetEnterprise, said Burt Lum, NetEnterprise president.
A footnote: Akamai now has created a new word, "akamaize," which it says is pronounced "AH kuh mize."
The company's advertising asks: "Are You Akamaized?" To be akamaized, the company says, is to be using Akamai's high-speed server network.
Bloomberg News contributed to this report.