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

 

Wood Producers: Crisis In New Zealand Log Supply

New Zealand wood processing leaders held a hui with senior government officials and political leaders in Whangarei yesterday to assess the acute log supply shortage to local mills in Northland. More>>

Consents And Taxes: Trustpower 'Very Disappointed' With Judgement

Trustpower is "very disappointed" with a Supreme Court ruling dismissing its bid to claim tax deductions on $17.7 million of project costs in a case closely watched by large-scale infrastructure developers. More>>

ALSO:

Fruitful Endeavours: Kiwifruit Exports Reach Record Levels

In June 2016, kiwifruit exports rose $105 million (47 percent) from June 2015 to reach $331 million, Statistics New Zealand said today. Overall, goods exports rose $109 million (2.6 percent) in June 2016 (to $4.3 billion). More>>

ALSO:

Economic Update: RBNZ Says Rate Cut Seems Likely

The Reserve Bank will likely cut interest rates further as a persistently strong kiwi dollar makes it difficult for the bank to meet its inflation target, it said. The local currency fell. More>>

ALSO:

House Price Action Plan: RBNZ Signals National Lending Restrictions

The central bank wants to cap bank lending to property investors with a deposit of less than 40 percent at 5 percent and restore the 10 percent limit for owner-occupiers wanting to take out a mortgage with a deposit of less than 20 percent, according to a consultation paper released today. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news