Hoku cuts stock
offer price

The isle company is set to start
trading today on the Nasdaq
National Market

Hoku Scientific Inc.'s much-anticipated initial public offering was postponed yesterday after insufficient demand for the stock forced underwriters to cut the estimated price range to between $8 and $9 a share from between $11 and $13.

The Kalihi-based company's stock was scheduled to begin trading today on the Nasdaq National Market under the ticker symbol HOKU. It will become the first Hawaii company to have an IPO in six years. The new trading range for the company was disclosed yesterday in a filing with the Securities and Exchange Commission.

Hoku, which develops fuel-cell technology, still plans to offer 4.2 million shares and to allow its underwriters the option to purchase an additional 630,000 shares. If the 4.83 million shares are purchased, the company would raise about $43.5 million. Under the previous trading range, Hoku could have brought in $62.8 million at a $13 offering price.

Piper Jaffray, SG Cowen & Co. and Thomas Weisel Partners LLC are the underwriters of the offering.

Hoku was co-founded four years ago by Dustin Shindo and Karl Taft, who were classmates at Waiakea High School on the Big Island. Shindo, 31, is the chairman, president and chief executive officer and Taft, 32, is the chief technology officer. Both will become multimillionaires after the offering.

The company said it plans to use $6 million of the net proceeds from the IPO to help build its new headquarters, $5 million to continue research and development, and the balance for working capital and other purposes, including potential acquisitions.

Hoku said it is building approximately 14,000 square feet of office, research and development and manufacturing space in Kapolei.

Last month, Hoku secured a $3.5 million credit facility with Central Pacific Bank to finance part of the construction at an interest rate of 5.3 percent. Hoku said it plans to draw down $3 million under the credit facility this quarter, with construction expected to be finished by next month.

Hoku said in its amended filing that if the stock is priced at $8, it would receive net proceeds of about $29.7 million, and as much as $34.4 million if the underwriters purchase the additional shares.

The company disclosed in the filing it had a net loss of $728,000 in its fiscal year ended March 31, compared with a net loss of $2.9 million a year earlier.