New Zealand's Powerhouse Ventures files for $15m IPO

It is offering 18.7 million shares priced at A$1.07 apiece and hoping to raise a minimum of A$10 million. This represents as much as 49% of issued shares, which means the firm will have a valuation of up to A$40.8 million.

According to a filing, the majority of the proceeds will be deployed during an 18-month period across Powerhouse's existing portfolio of 19 companies and investments in new ventures, including an expanded footprint in Australia. Capital will also be used to invest in intellectual property from universities and other research-intensive organizations in New Zealand and Australia.

"Historically, university and crown research institute research in Australia and New Zealand has not been commercialized in a structured way," said Kerry McDonald, Powerhouse's chairman and non-executive director. "Powerhouse has specialized in management and processes that have a proven track record in New Zealand in developing and targeting such research to the needs of the market and in the process, achieving significant increases in value for investors."

Incorporated in 2006, the firm focuses on early-stage technology investments in environmental, engineering, healthcare and IT businesses. Pre-seed commitments are typically less than NZ$300,000 ($216,000) while seed and post-seed stage investments range from NZ$1-5 million, with an aim of maintaining about a 40% holding in portfolio companies.

Since 2009, Powerhouse has charted a 34.6% IRR on its investments. Net tangible assets amounted to NZ$21 million as of the end of March.

Two previous share issues by the firm raised NZ$3.5 million and NZ$5.2 million, respectively. This funded investments of NZ$1 million and NZ$2.8 million during the 2015 and 2016 financial years. Powerhouse also issued NZ$1.2 million in convertible notes earlier this month to assist with the investment requirements of its portfolio companies and to provide working capital. These notes will converted into about 1.2 million ordinary shares upon completion of the IPO.

The float extends a string of fundraising activity in New Zealand's venture capital space this year, including LP commitments of NZ$38 million and NZ$20 million for funds managed by Global From Day One and Movac, respectively.

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• Topics
• Australasia
• Technology
• Fundraising
• Venture
• New Zealand
• Australia
• IPO
• seed
• Venture