Spansion Gets $12 a Share

Spansion(SPSN Quote), the flash memory joint venture between Advanced Micro Devices (AMD Quote) and Fujitsu, priced its initial public offering below the expected range.

Underwriters led by Citigroup and CSFB priced 42.2 million shares at $12 apiece, raising a little more than $500 million for the Sunnyvale, Calif., company. That was below the range of $13 to $14 a share predicted in an SEC filing Thursday morning and well below the $16 to $18 Spansion hoped to fetch earlier in the month.

"It's a very price-sensitive situation," says Sal Morreale, who tracks IPOs for Cantor Fitzgerald.

Spansion's Class A shares will start trading Friday under the symbol SPSN. The company granted its underwriters an overallotment option 5.1 million shares.

Chip companies that are spun off from larger parent companies can cause investor concerns, said Morreale, comparing Spansion to the 2004 offering of Freescale Semiconductor (FSL Quote), which experienced similar pressure as it was spun off from Motorola (MOT Quote).

While the Spansion deal was supposed to be priced Wednesday night, with shares going on sale to the public Thursday, the offering was pushed back a day.

Spansion makes so-called NOR Flash memory, which is used to store programming instructions in consumer electronic devices like cell phones and MP3 players.

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