Auckland-based IT capital company Strathmore Group aims to raise $8 million via a cash issue to invest in high-tech businesses.
Strathmore Group will target Internet, electronic commerce and IT companies and provide finance, strategic advice and a network of relationships to assist international trade. It also manages a high-tech incubator fund which enables smaller companies to grow to the point where they are ready for such a migration.
Strathmore plans to raise capital for investment via a 10-for-one cash issue at 50 cents per share, when a prospectus is ready.
The company's first acquisition is the investment arm of technology advisory firm, Foresight Partners, including its interest in telecommunications and Internet software company, CommSoft, in return for 955,882 Strathmore shares issued at 18 cents. Strathmore will acquire a stake of up to 31% in CommSoft, a telecommunications and Internet software company that has developed a Web browser-based business application for telephony management, cost allocation and tarrifing. The business operates in New Zealand, Australia and the UK.
Foresight Partners' founder, Phil Norman, as well as Peter Wright and Don Cowie, have been appointed to the board of Strathmore, with Norman becoming chairman.
"Strathmore will act as a knowledge bank to investee companies in the Internet, e-commerce and related sectors, assisting them to compete internationally. The board is a seasoned team with an excellent international network of financial, commercial and marketing relationships, a track record in taking [New Zealand] companies offshore and an understanding of US capital markets," says Norman.
"We will work with senior management in investee companies to develop optimal strategies for entry and growth in US and European markets."
Meanwhile e-commerce company Advantage Group bought a 20% holding in Strathmore for $600,000 two weeks ago.
Advantage Group chairman Evan Christian says while Advantage is not a venture capital company it wanted to be involved in a vehicle that could feed new business applications in the market and help them grow and develop. "As an investor, Advantage can participate without diverting attention from the company's core business."
CEO Greg Cross says: "Being part of Strathmore enables Advantage to refer technology investment opportunities to a qualified and capable firm for appraisal and action.
At the same time it allows Advantage to develop close relationships with other companies involved in the same sector and gives the company early access to new tools and technologies."