The Wall Street Journal-20080130-Cascal- ATA Debuts Generate Tepid Interest From Investors

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Cascal, ATA Debuts Generate Tepid Interest From Investors

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The initial public offerings of a British water-utilities company and a Chinese educational-testing firm didn't draw much excitement from U.S. investors.

The IPO of water-services company Cascal BV closed at $12 a share at 4 p.m. in New York Stock Exchange composite trading, flat with its IPO price. Chinese educational-testing-services company ATA Inc. closed at $8.75 on the Nasdaq Stock Market, down 7.9% from its $9.50 IPO price. Both companies became public on a day that broader markets indices traded higher.

Cascal, which had planned to debut in the U.S. last week, ended up reducing both the price and the number of shares it sold in the offering before it could go public. The company raised a total of $144 million, almost half the $317 million it had aimed for at the high end of its original $17-to-$19 price range, which was set by underwriter J.P. Morgan Chase & Co. The number of shares it sold dropped to 12 million from the 16.7 million it had planned to sell last week.

Cascal, which began in 1989 as the United Kingdom privatized its water industry, now supplies treated water and processes wastewater in eight countries: the U.K., South Africa, Indonesia, China, Chile, Panama, Mexico and the Philippines.

Meanwhile, ATA's weak early performance indicates that the unease investors began displaying toward some Chinese stocks at the end of 2007 is likely to carry through to 2008. The company priced its offering at the low end of its expected range and sold 4.9 million shares, its original scheduled amount, through underwriter Merrill Lynch & Co.

Based in Beijing, ATA offers computer-based testing services, career-education and test-preparation programs focused on professional licensures and certifications.