Televox International, a successful -Auckland-based manufacturer and exporter of voice processing systems, is to relocate to California because of a lack of understanding of — and investment backers for — its business needs in New Zealand.
The company received a "substantial" injection of capital from business interests in Malaysia last year but those investors now want to cash out of their investment. The search for a new major shareholder has left chief executive Dr Mike Johnston despairing of New Zealand investment companies and individuals. "Local fund managers have not progressed beyond the mindset for valuing farms and commercial properties," he says.
Televox was established in 1990, sent its first exports to Australia that year and has since won major telecommunications contracts throughout Asia-Pacific. By 1996 it was exporting 82% of its output, and was awarded a Trade NZ Export Commendation.
The company has now found a backer in Diversified Speciality Communications from California. The US company will form a new subsidiary, Televox USA, to be headed by Johnston. Some manufacturing of hardware and software will continue in New Zealand for the time being, but will eventually be moved to the US.
Johnston says he is sad to see DSCI gain control of Televox for a sum which he says was too low. "New Zealand technology companies are substantially undervalued," he says. "New Zealand has dozens of firms that could attract deals of $30 million to $40 million in North America, Europe and China, but the lack of investment is holding them back."
In return for relatively small sums, investment companies in New Zealand want too much too soon, he says. "Despite professing to be technology-oriented, their executives really don't understand the complexities of technology management and research."