Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Xero raises $180M selling shares at premium to Matrix, Thiel

Xero raises $180M selling shares at premium to Matrix, Thiel, others

Oct. 14 (BusinessDesk) – Xero, the cloud-based accounting company whose shares have more than doubled this year, raised $180 million selling shares to Matrix Capital Management, Peter Thiel-backed Valar Ventures and other investors to ensure it can keep bankrolling its expansion.

The Wellington-based company sold 9.92 million shares at $18.15 apiece, a 1.1 percent premium to their price last week before being halted for the capital raising. The new funds more than quadruple the cash buffer Xero has to fund sales growth as it chases 1 million customers, almost five times its current customer base of 211,000.

“Xero is emerging as the definitive software platform for small business worldwide,” David Goel, managing member of Matrix, said in the statement. “Having empowered hundreds of thousands of small and medium-sized businesses in New Zealand, Australia, and the United Kingdom, Xero is poised to do the same for its 29 million potential customers in the US. We are adding to our investment to help facilitate and accelerate this goal.”

Cash on hand rises to $230 million from the $55 million it disclosed as at Sept. 30. The sale represents 8 percent of the enlarged capital of the company.

Valar and Matrix last injected funds into Xero in November, with $60 million of new capital, while buying $22 million of shares from director Craig Winkler, chief executive Rod Drury, and co-founder Hamish Edwards at the same time.

Xero has been burning through funds as it posts short-term losses as part of a strategy to build global scale.

The company didn’t disclose how many shares were allocated to which investors. US investors accounted for $147 million of the funds raised and “represent some of the most enduring and well-capitalised asset management firms in the world, all of whom will assist the company with its strategy and execution in the US market.” it said.

The shares last traded at $17.95.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Scoop Business: PayPal Stops Processing Mega Payments; NZX Listing Still On

PayPal has ceased processing payments for Mega, the file storage and encryption firm looking to join the New Zealand stock market via a reverse listing of TRS Investments, amid claims it is not a legitimate cloud storage service. More>>

ALSO:

Housing Policy: Auckland Densification As Popular As Ebola, English Says

Finance Minister Bill English said calls by the Reserve Bank Governor for more densification in Auckland’s housing were “about as popular in parts of Auckland as Ebola” would be. More>>

ALSO:

Crown Accounts: NZ Government Deficit Smaller Than Expected In First Half

The New Zealand government's operating deficit was smaller than expected in the first six months of the financial year, as the consumption and corporate tax take rose ahead of forecast in December, having lagged estimates in previous months. More>>

ALSO:

Fruit & Veg Crackdown: Auckland Fruit Fly Find Under Investigation

The Ministry for Primary Industries (MPI) is investigating a find of a single male Queensland fruit fly in a surveillance trap in the Auckland suburb of Grey Lynn... MPI has placed legal controls on the movement of fruit and some vegetables outside of a defined circular area which extends 1.5km from where the fly was trapped in Grey Lynn. More>>

ALSO:

Scoop Business: Westpac NZ Reaches $2.97M Swaps Settlement

Westpac Banking Corp’s New Zealand unit has agreed to pay $2.97 million in a settlement with the Commerce Commission over the way the bank sold interest rate swaps to farmers between 2005 and 2012. More>>

ALSO:

Get More From Scoop

 
 
Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news