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Basin Water hits market at $12 and jumps to $16 per share 


By Steve Gelsi 
Basin Water Inc. (BWTR) added one million shares to its initial public offering and priced at the top of the range for its stock-market debut on Friday. 

The maker of water-filtration equipment offered six million shares at $12 each in a bid to raise $72 million with underwriter Janney Montgomery Scott. 

In a sign of strong investor interest, Basin Water priced atop its $10-$12 range, after increasing the price from $8-$10 a share earlier this week. 

Basin Water, Rancho Cucamonga, Calif., reported a profit of $563,000 on revenue of $12 million in 2005, compared to a loss of $556,000 on revenue of $4.3 million in the previous year as a seller of systems for the treatment of contaminated groundwater. 

As of Dec. 31, the company's revenue backlog was $77 million - an increase of 120% - from the year-earlier period. 

"We expect to achieve our goal of becoming the leading provider of groundwater treatment systems in the United States through the following strategies: target key groundwater contaminants; expand our business throughout the arid west; extend our geographic reach throughout the United States; and maintain and extend our technology position," the company said.

Basin Water is a relatively young company. It began in 1999 and didn't generate revenue until 2002. Its first profitable year was last year, when it earned $563,000 on revenue of $12.2 million, compared with 2004's net loss of $556,000 on revenue of $4.3 million. It now has 50 treatment plants delivered or in the process of delivery in California and Arizona. 

The company's treatment plants use a patented ion-exchange system to reduce groundwater contaminant levels such as perchlorate and arsenic in drinking water. Among the trends working in Basin Water's favor are rising population growth and decreasing drinking-water supply, particularly in the arid southwestern U.S. 

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