WebMethods IPO Blasts Off, Rising 508%

The IPO market continued its selective euphoria Friday, with WebMethods Inc. soaring sixfold and Pets.com Inc. lying down and playing dead.

Fairfax, Va.-based WebMethods (ticker symbol: WEBM), whose Internet software links computer systems so companies can interact with customers, staged the biggest first-day gain this year, rising $177.63, or 508%, to $212.63 from an initial public offering price of $35. It was the fourth-best debut ever.

Reston, Va.-based Via Net.Works Inc. (VNWI) and Chicago-based Lante Corp. (LNTE) more than doubled after their initial stock sales, as investors bet demand will surge for the companies’ Internet software and services.

All three companies had already increased the size of their initial sales, which analysts said only helped spur demand for the shares.

Via Net.Works, which helps European and Latin American companies get started on the Web, jumped $28.81, or 137%, to $49.81, after raising $300 million. Lante, which helps businesses improve their use of the Internet, leaped $34.94, or 175%, to $54.94 after raising $80 million.

Flag Telecom Holdings Ltd. (FTHL), a Bermuda-based company whose Britain-to-Japan network carries voice and data for phone companies worldwide, rose after selling $761 million in stock, the biggest sale of the day. The shares gained $8.50, or 35%, to $32.50.

But San Francisco-based Pets.com (IPET), which sells pet products online, closed unchanged at $11 after its $82-million sale.

“The online pets world is going to be a very competitive battle, and the question is whether it’s worth the effort of picking who will win it,” said Dennis McKechnie, portfolio manager at Pimco Equity Advisors fund.

Companies challenging Pets.com include Petsmart.com, which last week filed to sell shares; Petopia Inc.; and PetStore.com Inc.

Other stocks greeted with a thud Friday included Fargo Electronics Inc. (FRGO), which rose 13 cents, or 1%, to $15.13, and Beasley Broadcast Group Inc. (BBGI), which tumbled $1.38, or 9%, to $14.13.