Star Tribune Quarterly Deal Report 1st Quarter/2000; Almost nothing but Net; Most of Minnesota's first- quarter initial public offerings were technology companies, but recent market fluctuations suggest a change in strategy may be underway.: [METRO Edition]

UNPUBLISHED CLARIFICATION OF 05/25/00: U.S. Bancorp Piper Jaffray had more deals than originally reported in the 04/24/00 Quarterly Deal Report. See story and chart in the Star Tribune of 5/22/00, page 03D, headlined: 'Software glitch shortchanges Piper in quarterly deal report.'

The market's continuing fondness for technology stocks, especially those with ties to the Internet, kept dealmaking alive in Minnesota and nationwide in the first quarter.

But the performance of many of those stocks - as shown by the recent drops in the tech-rich Nasdaq composite index - suggest a refinement of the nothing-but-Net strategy is underway.

Technology companies accounted for nearly all of the initial public offerings, secondary offerings and private equity placements done by Minnesota investment bankers in the period. The heavy emphasis on Internet and communications equity deals helped compensate for an overall decline in IPOs to 23, compared with 33 in the fourth quarter of 1999.

Secondary offerings - many of them follow-up deals for tech companies taken public in 1999 - rose to 33 in the first quarter, compared with 20 in the fourth quarter last year.

Locally, Net Perceptions of Minneapolis fits that category; it raised $118.8 million in March, 11 months after its initial public offering. Net Perceptions shares, which were priced at $45.25 for the March 23 offering, closed Thursday at $21.50 - a casualty of the tech- sector sell-off on April 14.

The same trends surfaced throughout the United States, which saw a drop in IPOs and an increase in secondary offerings in the period, according to data compiled by CommScan, a New York-based securities research firm.

"There's still a lot of filings coming in," said Frank McGee, a senior analyst at CommScan. "But it's becoming more focused. There's been some recognition that values last year were stretched, and now the door [for stock offerings] is getting narrower, where only premiere companies can enter."

While one quarter's worth of aftermarket performance is a small indicator, it...