Home' Forge : Vol 1 No 2 Contents wealth creator // 117
companies to list earlier on the ASX
rather than follow the traditional
approach of several rounds of venture
capital or private equity funding,
before using an IPO as an exit
mechanism for early investors.
Freelancer ’s 50-cent issued shares
soared to $2.50 on debut, such was
the demand for stock in the online
provider of micro-job listings.
Freelancer traded at $1.15 in May 2015,
making it one of the better-performing
tech floats in recent years, albeit after a
Several tech companies were
looking to list as Forge went to
press. 1st Available Ltd, a provider
of online healthcare and booking
services, sought to raise $12 million.
group Superloop wanted to raise
$17.5 million and list on the ASX.
Here are six tech IPOs or backdoor
listings from the last three years
1. 3P Learning
The education-technology company,
known for its popular Mathletics,
Reading Eggs, Spellodrome and
IntoScience games, traded just below
the $2.50 issue price as Forge went to
press, despite exceeding prospectus
forecasts and market expectations in
its latest interim result.
About five million children, through
17,000 schools in more than 200
countries, use 3P Learning’s products.
More students in the United Kingdom
now use Mathletics than in Australia,
and 3P has strong growth prospects in
the United States, a market where it is
expected to make more investments
or acquisitions. About one-third of its
revenue is earned offshore.
3P thought about global markets
early in its life cycle, and will reap the
rewards in the coming decade as it rolls
its product suite into new markets. It is a
high-quality, well-run business.
2. OzForex Group
The provider of online international
payment services had been a star IPO,
soaring from a $2 issue price to as high
as $3.50 within six months of listing,
after raising $439 million in November
2013. But it shed almost one-quarter
of its value last year after announcing
lower-than-expected growth in
customer acquisitions and higher costs.
With less than five per cent market
share in Australia, OzForex has
good long-term growth prospects
and could make a handy acquisition
for a multinational travel provider
that wants to move into the foreign
exchange services market, and take
some share off the banks.
Another backdoor listing worth
watching is Covata, a fast-growing
global data-security company. It
listed on the ASX in November 2014
through an off-market takeover bid
by Prime Minerals for all of the issued
shares and options of Cocoon Limited.
The new entity was named Covata.
Covata raised $15 million and had a
$76 million capitalisation on listing,
making it one of the largest tech
companies to list last year. It has
performed well since listing.
The online property-management
services group listed on the ASX
through a $20 million IPO in
September 2014. Its 50-cent issued
shares rallied to $1.25 in late May 2015.
Urbanise.com’s service helps building
owners to manage help desks,
maintain common areas, manage
energy consumption and fix system
breakdowns. It remotely monitors
buildings using equipment connected
via the internet.
The wholesaler of Microsoft’s public
cloud offerings soared from 60 cents in
April 2014, when it came to the ASX as
a backdoor listing, to $1.69 in late 2015.
Rhipe provides Microsoft’s public cloud
software offerings, including Microsoft
365, and the Windows Intune and
Enterprise Mobility Suite, to resellers. It
has potential for rapid earnings growth
in Australia and, increasingly, South-East
Asia as it secures other global software
vendors as clients, and expands the range
of program licences.
Rhipe’s recurring revenue from
licensing, as well as its business model,
growth prospects and management
team are other attractions.
6. Bulletproof Group
The cloud-computing services
provider raised $2.85 million and
listed in January 2014 through the
shell of explorer Spencer Resources.
Bulletproof shows how small caps
can benefit from industry disruption,
rather than drive it. As more
companies ‘lift and shift’ their data
to the cloud, demand for specialist
cloud-management service providers
will grow quickly.
Bulletproof is well positioned
to benefit from growth in cloud
computing, thanks to a valuable
relationship in Australia with Amazon
Web Services (AWS).
Tony Featherstone is a former managing
editor of BRW and Shares magazines.
Readers should do further research of
their own or talk to their adviser before
acting on themes in this article. This
column does not imply investment
recommendations. Readers are encouraged
to seek professional advice before
investing as this article does not take into
account individual financial objectives.
All prices, analysis, and performance
figures current at time of print.
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