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


ERoad shares rise 11% in NZX debut after $46 million IPO

ERoad shares rise 11% in NZX debut after $46 million IPO

By Suze Metherell

Aug. 15 (BusinessDesk) - Shares of ERoad, the logistics and fleet management company, rose 11 percent on its NZX debut after its initial public offer raised $40 million in new capital to fund international growth plans.

The stock first traded at $3.32, up from its $3 offer price. It recently traded at $3.35, valuing the company at $201 million. Institutional investors picked up 70 percent of the 15.3 million shares on offer, which saw existing owners sell 2 million shares, or $6 million worth, to keep 75 percent stake in the company. There was no public pool.

Of the new capital raised, $3 million will go to repay bank debt, with the remaining cash used to fund ERoad's growth, particularly in the US, where it launched commercial services in Oregon in April. The company has said it will look at potential acquisitions to further expand and enter new markets.

Founded in 2009, ERoad says it was the first company to provide a nationwide GPS-based road user charge system. It first turned a profit of $2.9 million in the year ended March 31, 2014, on $10 million in sales. In its July prospectus it forecast revenue to rise to $19 million in 2015, and to $34 million in 2016, but expected to post a loss of $1 million in 2015, due to $2 million in listing costs, before returning to profit of $5.5 million in 2016.

The company doesn't intend to pay dividends in the near term.

ERoad is the ninth company to list on the bourse this year, and follows cinema software and analytics firm Vista International Group's debut on Monday, and mobile payment app maker Pushpay's compliance listing on the NZ Alternative Index yesterday. The NZX has experienced a flurry of tech-based listings, which has been a mixed bag for investors, Gentrack Group, the airport and utility software firm, had initially traded above its offer price, but its share price dropped after it issued a profit warning, effectively cutting earnings some 32 percent, five weeks after its public float.

Other recent listings, including Serko, the travel software booking business, ikeGPS, the portable measuring app, and Scales Corp, the fruit and vegetable packaging and logistics company, have all failed to trade above their offer price. While the government's last partial privatisation, Genesis Energy, Intueri Education, the education providers, Metro Performance Glass, the glass manufacturer, and Vista have all traded above their IPO prices.

The sole lead manager for the offer was First NZ Capital, with Deutsche Craigs as co-manager.


© Scoop Media

Business Headlines | Sci-Tech Headlines


Internet: NZ Govt Lifts Target Speeds For Rural Broadband

The government has lifted its expectations on faster broadband speeds for rural New Zealand as it targets increased spending on research and development in the country's information and communications technology sector, which it sees as a key driver for export growth. More>>


Banks: Westpac Keeps Core Government Transactions Contract

The local arm of Westpac Banking Corp has kept its contract with the New Zealand government to provide core transactions, but will have to share peripheral services with its rivals. More>>


Science Investment Plan: Universities Welcome Statement

Universities New Zealand has welcomed the National Statement of Science Investment released by the Government today... this is a critical document as it sets out the Government’s ten-year strategic direction that will guide future investment in New Zealand’s science system. More>>


Scouring: Cavalier Merger Would Extract 'Monopoly Rents' - Godfrey Hirst

A merger of Cavalier Wool Holdings and New Zealand Wool Services International's two wool scouring operations would create a monopoly, says carpet maker Godfrey Hirst. The Commerce Commission on Friday released its second draft determination on the merger, maintaining its view that the public benefits would outweigh the loss of competition. More>>


Scoop Review Of Books: She Means Business

As Foreman says in her conclusion, this is a business book. It opens with a brief biographical section followed by a collection of interesting tips for entrepreneurs... More>>


Hourly Wage Gap Grows: Gender Pay Gap Still Fixed At Fourteen Percent

“The totally unchanged pay gap is a slap in the face for women, families and the economy,” says Coalition spokesperson, Angela McLeod. Even worse, Māori and Pacific women face an outrageous pay gap of 28% and 33% when compared with the pay packets of Pākehā men. More>>


Get More From Scoop

Search Scoop  
Powered by Vodafone
NZ independent news