Trintech, the Dublin based electronic payments software company, saw its share price increase 20 per cent when it began trading yesterday on the German Neuer Markt and US Nasdaq exchanges, placing a total value on the company of $347 million (€332 million).
The shares, accounting for 23 per cent of the company, were priced at $11.55 (€11) and rose over the day to close at €14 on the Neuer Markt, while trading at a similar level on the Nasdaq around $13.87. Following yesterday's trades this stake is now valued at $80 million (€77 million).
The biggest beneficiaries from the sale are Trintech co-founders, brothers, Mr Cyril (39) and Mr John (37) McGuire. Having reduced their shared holding from 48 per cent to 37 per cent, it is now valued at $128 million (€123), or $64 million (€61 million) each.
Enterprise Ireland also retains a 5.7 per cent stake in Trintech. This will now be valued at $19.7 million (€18.95 million).
According to analysts, the 20 per cent rise over the day indicates Trintech and its advisers hit on a fair offer price for the shares. In a bid to achieve a stable base for the stock much of it was placed with institutional investors.
When the Neuer Markt opened, trading on Trintech stock was surprisingly brisk in spite of the battering a number of its technology stocks have taken in the past year.
The stock's performance on the Nasdaq was also quite strong. When the market opened the index had made a good recovery from the four per cent drop in value incurred the previous day by Microsoft president, Mr Steve Ballmer's crushing comments about technology stocks being overpriced.
Germany is Trintech's largest market, where it does a strong business in the sale of electronic point of sale (POS) systems and software. Germany accounted for 90 per cent of its POS revenues in 1999.
Trintech's biggest challenge now is breaking successfully into the US market, a move which has put the company into a loss making position since last year. The company prospectus says it does not expect to be in a profit making position for at least two years.
Trintech also has a long way to go in shifting its product offering away from hardware, with electronic POS sales still accounting for 65 per cent of its business.
The more lucrative software sales business currently stands at around 25 per cent, and last year Trintech raised $20 million (€19.1 million) in private financing to help boost its sales and marketing effort for the e-commerce software business.
In the past year Trintech's German competitors have achieved share price growth of over 100 per cent. Intershop, a very large German competitor, is currently trading at over 250 times sales. However, its sales growth is running at over 100 per cent annually, compared with 40 per cent growth in 1999 for Trintech to $21 million (€20 million).
