Transport shuffles right on tracks; positive reactions to video streaming; and dirty business across the water
Long game to pay off for US video-streaming group
THERE WAS a full house at the Burlington Hotel on Tuesday for the mergers and acquisitions (MA) breakfast conference organised by corporate finance house Raglan Capital.
Irish tech entrepreneur Brian Long outlined the latest IPO play for his Dublin-based Atlantic Bridge Ventures.
He did not name the company but it is widely believed to be Envivio, a high-growth business involved in video streaming based in San Francisco.
A listing on Nasdaq is planned for July 21st with Stiefel and Piper Jaffray hired as lead book runners.
At the conference, Long said the company had revenues last year of $40 million (€28.5 million) and a profit margin of 10 per cent. Revenue was growing by 1.8 times, year on year. He expected the business to have a valuation of between $280 million and $340 million on IPO. It had three potential acquisition targets in its sights, post-flotation, to help it maintain momentum.
Long co-founded Atlantic Bridge Ventures in 2005. Its backers include Denis O’Brien and Dermot Desmond. It has €230 million in assets under management and raised €85 million last year for a second fund.
“The appetite for IPOs is growing,” Long told the audience, adding that 80 per cent of those who had gone to market since November had exceeded their IPO price.
Long founded Parthus in 1993, with funding of $900,000. It had two successful public share offerings before merging with Ceva in 2003. More than $100 million was generated in employee wealth from Parthus/ Ceva from stock options, which in turn helped to fund at least eight start-ups.
One of those was GloNav. It had $16 million in investor backing at its launch in 2006 and was sold in January 2008 to NXP in a deal that valued it at $110 million. Long closed positively: “You will have more IPOs out of Ireland and you will have more MAs.”
Simon Clark of Fidelity Growth Partners was also positive. “We think Ireland is a wonderful place to start and build a company.”
Auld Sod hard to shift across sea
THERE IS an old saying that where there’s muck, there’s brass. Except in the case of the Auld Sod Export Company, it would seem.
It’s been flogging “Official Irish dirt” from Tipperary to Yanks for a number of years but has yet to turn up a profit.
Auld Sod made a loss of €170,879 in 2009 and incurred additional losses of €60,000 in the first 10 months of last year.
Accumulated losses amounted to €443,551 at the end of 2009 and the company’s auditors said that they were “unable to determine whether proper books of account have been kept by the company”.
A note to the accounts states that a new business plan has been drawn up to “significantly reverse the company’s fortunes”.
It is forecasting a €300,000 profit for 2012 based on the “successful implementation” of the new plan.
“The company has also benefited from a repeat order in December 2010 from a high-profile US reseller which will provide working capital to secure the company’s short-term survival.”
The directors say they “recognise” that its future “remains in doubt and is dependent on securing additional funding to continue operating in 2011”.
A rise in nostalgia across the Atlantic for the shamrock would also help.
Next CIE chair should signal direction change
WHEN HE returns from his St Patrick’s Day jaunt to India, one of the first matters the Minister for Transport, Leo Varadkar, will have to deal with will be the appointment of a new chairman for State-owned CIÉ.
Documents released to The Irish Times under the Freedom of Information Act show that John Lynch was reappointed last year by the Fianna Fáil-Green Party government for a “maximum period of one year until March 28th, 2011”. Lynch has been chairman since March 2000 and executive chairman since September that year, so a change at the top is long overdue. There is currently one vacancy on each on the boards of CIÉ, Iarnród Éireann and Dublin Bus and two at Bus Éireann. A further five will arise on the CIÉ board on April 28th, so Varadkar will have the opportunity to put his stamp on the bus and rail group.
The last government was long on guff about opening up the bus market in Dublin to competition but short on action, with the result that CIÉ subsidiary Bus Átha Cliath enjoys an effective monopoly.
Fine Gael and Labour also say they will “support the expansion in range and frequency of high-capacity commuter services, which will be subject to a cost benefit analysis”. Hopefully, Varadkar will follow through on these in a meaningful way.
CIÉ is certainly ripe for change. The Comptroller and Auditor General last year uncovered serious governance issues at the group, including failure to file accounts on time to the Department of Transport.
Lynch, who earns €252,000 as chairman, ran CIÉ as an independent fiefdom in spite of the €316 million annual subsidy it received.
Then there’s Colm McCarthy’s report on the sale of State companies. CIÉ isn’t exactly a prized asset. It lost €77.7 million in 2009 and passenger journeys declined by 11 per cent.
There would surely, though, be private- sector interest in operating the Dart. French group Veolia already runs the Luas, and there’s no reason why the State has to own Bus Éireann and Bus Átha Cliath.
Lynch’s departure should be the catalyst for significant changes at CIÉ. Hopefully, Varadkar will get on board.
Little Things
Stefan Vilner, the former chief executive of Irish airline JetBird, has landed the role of chief commercial officer with Danish carrier Cimber Stirling.
Vilner, who is Danish, left Stirling in 2007 to take the controls at executive jet airline JetBird, which was revving up for take-off at the time, with the backing of Dublin-based Claret Capital and Dómhnal Slattery.
JetBird was credit crunched and never got off the runway, winding down its activities last year. Good idea, just unfortunate timing.
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Sticking with aviation, Dómhnal Slattery's brother John has landed a plum job with Brazilian aircraft manufacturer Embraer. Based in Dublin, Slattery will oversee sales to leasing companies and head operations at in-house leasing unit Embraer Capital Corp. He is the first non-Brazilian to be hired for the job. His appointment was announced this week at an aircraft trading conference in Arizona.
Slattery helped create RBS Aviation Capital before founding Dublin-based Greenstone Aviation in 2009. He stepped down from Greenstone in January after giving up on plans to raise about $600 million to buy more aircraft.
"There comes a point in time when you have to move on," Slattery told Bloomberg this week, adding that the funding failed "because of market conditions".
Sounds like a wise move.
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Bookseller Eason has put its public relations account out to pitch. Financial Dynamics currently holds the contract and is one of four agencies pitching for the work. FD is believed to be up against Edelman, Q4 and WHPR.
Eason has a new management team, led by former BWG executive Conor Whelan, and is more proactive on the PR front.
