By Matthew Willett

Illumina Inc. has completed an IPO after just two years in business, raising $96 million in an initial public offering of 6 million shares priced at $16 each.

Goldman Sachs & Co., of New York, acted as lead underwriter for the offering, and Chase H&Q and SG Cowen Securities Corp., both also of New York, were co-managers. The company granted the underwriters an option for 900,000 shares to cover overallotments.

Illumina said it plans to use the proceeds from the public offering for general operations, including proprietary technology commercialization, research and development, and potential acquisitions.

Illumina reported revenues of $474,000 for 1999 and a net loss of $5.5 million. The company now has $120.7 million in cash, cash equivalents and short-term investments and 31.3 million shares outstanding.

Illumina develops next-generation tools for the large-scale analysis of genetic variation and function. Its proprietary BeadArray technology uses fiber optics for miniaturization, allowing for new experimentation scales.

The array arrangement in BeadArray allows for the simultaneous processing of up to 3 million assays. A complementary product, Oligator, permits parallel synthesis of the millions of pieces of DNA necessary for large-scale genetic analysis on arrays.

Illumina collaborates with PE Biosystems Inc., of Foster City, Calif., for the development, manufacture and marketing of array-based systems for high-throughput DNA analysis. PE Biosystems purchased $5 million of equity in Illumina as a part of that deal.

Shares of the company (NASDAQ:ILMN) began trading Friday at $29.875 and rose as high as $42.25, a 164 percent gain. The stock closed Monday at $35, down 10.6 percent.