VA Linux IPO soars almost 700 per cent

VA Linux Systems' share value rose nearly 700 per cent following its initial public offering on Friday, setting a record for a first-day percentage gain on Wall Street.

VA Linux, which started the day with an offer price of $US30, saw its shares rise to a high of $320 before closing at $239.25, up a whopping 697.5 per cent, on a volume of 7.68 million shares.

VA Linux distributes and services the open-source Linux operating system, which is seen by some as a potential alternative to Microsoft's Windows operating system. Linux is much less widely used than Windows, but has been touted by some as a strong, low-cost platform for Web servers.

"There is the belief that Linux will be the alternative OS (to Windows) and that it has the potential for supplanting Microsoft," Tim Bajarin[CQ], president of Creative Strategies.

Red Hat another Linux distributor, went public on August 11 at $14 a share and has since seen its stock rise to $286.

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