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

 


ERoad to raise $49.5 million in pursuit of US growth

ERoad to raise $49.5 million in pursuit of US growth

By Suze Metherell

July 18 (BusinessDesk) - ERoad, whose products allow transport companies to manage and pay road user charges and keep track of their fleet, is looking to raise up to $49.5 million in an initial public offer next month as it chases growth in the US market.

The Auckland-based company will sell between 13 million and 15.7 million shares at an indicative price range of $3 to $3.80 per share, of which $40 million will be new capital, with existing shareholders selling between 2.4 million and 2.5 million shares and keeping about three-quarters of the business, according to its prospectus lodged with the Companies Office. The indicative price range would value the company at between $180 million and $228 million.

The new capital will be used to pay off $3 million in bank financing and fund the company's expansion into the US, targeting Oregon, where it commercially launched in April. EROAD has also entered the Australian market. It might also look at new markets via acquisitions.

"ERoad’s transition to a publicly-listed company represents the next step on its path to becoming a global technology leader," said chairman Michael Bushby in a letter to potential shareholders. "ERoad has a highly-scalable technology platform and robust business model, now supported by a further international reference site in the United States."

Founded in 2009, the company has developed GPS software and hardware which allows logistics companies to track their fleet and manage and pay road user charges.

The business first turned a profit of $2.9 million in the year ended March 31, 2014 on sales of $10 million. It forecasts revenue to rise to $19 million in the 2015 year and to $34 million the following year, according to the prospectus. Eroad expects to report a loss of $1 million in 2015 due to listing costs of $2 million, before returning to profit of $5.5 million in 2016. ERoad is also predicting a drop in its retention rate, from 99.3 percent, to 96.5 percent over the next two years.

The company doesn't anticipate paying dividends over the forecast horizon, with surplus funds kept "to capitalise on immediate and future market growth opportunities."

The final price is expected to be announced on July 29, with a listing on Aug. 15. The offer opens on July 30 with a preference pool closing on Aug. 6 and the broker firm offer closing on Aug. 12. The IPO won't have a public pool.

First NZ Capital is the sold lead manager of the offer and Deutsche Craigs is the co-manager.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Scoop Business: Spark, Voda And Telstra To Lay New Trans-Tasman Cable

Spark New Zealand and Vodafone, New Zealand’s two dominant telecommunications providers, in partnership with Australian provider Telstra, will spend US$70 million building a trans-Tasman submarine cable to bolster broadband traffic between the neighbouring countries and the rest of the world. More>>

ALSO:

Statistics: Current Account Deficit Widens

New Zealand's annual current account deficit was $6.1 billion (2.6 percent of GDP) for the year ended September 2014. This compares with a deficit of $5.8 billion (2.5 percent of GDP) for the year ended June 2014. More>>

ALSO:

Still In The Red: NZ Govt Shunts Out Surplus To 2016

The New Zealand government has pushed out its targeted return to surplus for a year as falling dairy prices and a low inflation environment has kept a lid on its rising tax take, but is still dangling a possible tax cut in 2017, the next election year and promising to try and achieve the surplus pledge on which it campaigned for election in September. More>>

ALSO:

Job Insecurity: Time For Jobs That Count In The Meat Industry

“Meat Workers face it all”, says Graham Cooke, Meat Workers Union National Secretary. “Seasonal work, dangerous jobs, casual and zero hours contracts, and increasing pressure on workers to join non-union individual agreements. More>>

ALSO:

Scoop Business: ComCom Charges Hawkins’ Finance Companies Over Debt Recovery

The Commerce Commission has filed criminal proceedings against two finance companies run by former 1980s high-flyer Allan Hawkins over their debt recovery practices. More>>

ALSO:

Science Media Centre: The Big Science Stories Of 2014

It was a dramatic year for science, one that witnessed a severe outbreak of Ebola in West Africa and an historic mission to land a space probe on a comet. On the home front... headlines with animal testing for 'legal highs', 1080 use to tackle increased pest numbers and court action over genetically modified organisms among the most-covered stories. More>>

ALSO:

Get More From Scoop

 
 
Standards New Zealand

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