Wireless LAN Vendor Meru Networks Files for IPO

Company Seeks to Raise $86.25 million

December 26, 2009 – The wireless local area network (LAN) vendor, Meru Networks has filed a registration statement with the U. S. Securities and Exchange Commission (SEC) for an initial public offering (IPO).  The company’s filings indicate that it is seeking to raise  $86.25 million, and that the funds would enable the company to prepare for what it expects to be a period of rapid growth in the industry.  

The company is seeking that its shares trade under the ticker symbol MERU. 

Meru Networks’ filing with SEC came at the end of a very slow year for US IPO.  The US IPO market was adversely affected by the US economic slowdown, and gloomy economic prospects.   Despite2009 having been a period of reduced revenues for companies selling enterprise information technology (IT) products, many analysts see wireless and LAN sales increasing in 2010 as some growth returns to the industry. 

Meru Networks’ product line couples wireless LAN resources into a single virtual cell that can span an entire campus, office or factory.  Other companies specializing in the emerging industry of what is becoming known as “enterprise wireless LANS”, that is dominated by Cisco Systems, includes  Aruba Networks and Trapeze Networks.

Meru Networks’ revenues were almost $16 million in 2007 and $55 million in 2008. For the first nine months of 2009, the company’s revenues were more than $50 million. But, the company is far from profitable.  The company lost $26.8 million in 2008, which corresponds to almost 50% of its revenues for the period and lost $9.4 million for the first nine months of 2009.