Synacor throws in the towel on IPO

Digital content provider Synacor Inc. announced yesterday that it withdrew its initial public offering due to unfavorable market conditions. The plan to go public had been in the hopper since August of last year, when the company said it intended to sell 11.6 million shares for an estimated $86 million, and trade on the Nasdaq.

The Buffalo, N.Y. company, which supplies broadband providers with the tools they need to create Internet portals, video players and other content, says it decided to withdraw its S-1 filing from the Securities and Exchange Commission for several reasons. Chief among them is that it costs the same to renew a filing as it does to simply refile at a later date when the economy is looking up, VentureWire reported. The SEC’s quiet period policies have also been restricting some of the company’s marketing and communications efforts. And overall, it wasn’t depending on IPO funds for expansion.

While the company is now profitable, it did post a loss of $1.6 million at the end of last year, which might have cooled enthusiasm for the IPO. In general, its been a tough stretch for companies looking to go public. Five others pulled their applications just last week, according to Reuters. And this year, only 30 deals have gone ahead — less than 25 percent of the 2007 figure.

In the past, Synacor has received $28.9 million over three rounds of funding from investors like Walden International, Crystal Internet Ventures, Advantage Capital Partners, Intel Capital, North Atlantic Capital and Rand Capital.