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Here is another sign that the market for Canadian technology stocks is definitely back.
The Toronto Stock Exchange is getting a publicly traded semiconductor company once again as ViXS Systems Inc. gets set to go public in a deal that investors are clamouring to be part of. It may end up being the largest going public deal in technology in Canada in years.
Tech stocks have been the hottest performing sector on the TSX lately. But there aren't enough to go around. Many technology companies were bought up in recent years, leaving a paucity of options for investors wanting into the space.
Toronto-based ViXS makes chips and software that it supplies to makers of digital tvs, set top boxes, video recorders, and other media applications. It is a so-called "fabless" chip maker in that it designs and sells semiconductors, but outsources the actual production.
The ViXS transaction, which involves merging with a capital pool company and doing a private placement, is likely to yield a company with a valuation in the $175-million range. So far, more than two dozen investors have signed on, retail investors are keen, and that means a deal that is well oversubscribed, said one person familiar with the transaction.
The deal is led by GMP Securities and Stifel Nicolaus.
ViXS's venture capital backers include Celtic House Venture Partners and Novacap.
(Boyd Erman is a Globe and Mail Reporter & Streetwise Columnist.)
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