Omnicell Investors Await Expiration Lockups

Omnicell (OMCL) is a prime example of a company that just refused to give up.

The Palo Alto, Calif.-based company makes automation systems and software for hospitals and nursing homes.

On April 20, 2000, Omnicell, then called Omnicell.com, filed to raise as much as $57.5 million in an IPO. Two months later, the company set its terms -- and then did nothing. Omnicell didn't file another document with the Securities and Exchange Commission until March 2001, announcing that the deal was being withdrawn and citing "changes in the Registrant's business and financing plans, recent market volatility and other considerations." I considered that a typical move, given the lull in the IPO market at the time.

A few days later, however, Omnicell did the unimaginable: It refiled. After dropping the dot-com from its moniker, Omnicell emerged not only with a new name, but a new underwriter, U.S. Bancorp Piper Jaffray. The company also moved away from attempting to create its own proprietary B2B network and instead utilized existing networks. Apparently things really were occurring at Internet speed.

The company went through the whole registration process once again, and on Aug. 6, 2001, Omnicell priced 6 million shares at $7 each, raising a total of $39.06 million in proceeds after the underwriting discount. Now it's time for Omnicell's final IPO hurdle, the lockup expiration, which occurs over the coming weekend and makes Monday its first possible trading day.

I'll leave you with two things to consider. First, Tuesday night is Omnicell's fourth-quarter earnings announcement, so investors and those restricted shareholders will undoubtedly pore over the results. The consensus estimate is for the company to earn 2 cents a share in the quarter. Second, these "locked-up" shareholders have been holding their shares for a very long time, and I expect them to act accordingly.

In Tuesday trading, shares of Omnicell were up 22 cents, or 2.7%, at $8.42.

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