Online marketing company ReachLocal Inc. priced shares far below the expected range Wednesday night, raising $54.2 million.

The Woodland Hills, Calif., company sold 4.2 million shares to initial investors for $13 each, below the expected price range of $17 to $19 late Wednesday. Stockholders sold 850,564 of the shares in the IPO. Those proceeds will not go to ReachLocal. Underwriters led by JPMorgan may buy another 625,000 shares to cover excess demand.

ReachLocal helps small to mid-sized businesses target local customers. Founded in 2004, ReachLocal has posted annual losses for the past three years. It said in a regulatory filing on May 18 that it expects net operating losses for the "foreseeable future."

Demand for IPOs also remains weak as economic concerns in China and Europe weigh on broader stock markets. Investors have been demanding discounts on shares of new companies, and nearly half of the deals this year have priced below expectations. Nine out of the 11 IPOs in May have priced at the bottom of or below expected ranges, including the two this week, while another seven IPOs have been withdrawn or postponed this month.

Shares of ReachLocal are expected to begin trading on the Nasdaq Thursday under the symbol "RLOC."