eVentures float pushes ahead in wake of share slump

By Michele Simpson

Thursday 20th April 2000

Media mogul Rupert Murdoch and Auckland businessman Craig Heatley's e-commerce company, eVentures, will still float here next month despite this week's turmoil in technology stocks.

eVentures released its prospectus this week for the float - 50,000 shares are on offer at 60 cents each.

Analysts said the $30 million share offering appeared to be based on a valuation of Mr Murdoch and Mr Heatley's shares in the company because full details of the e-commerce businesses it was offering had not been released.

Current shareholders are eVentures Partnership (64%) - including Softbank and Rupert Murdoch's epartners - Sky chairman Craig Heatley and affiliates (16%), corporate shareholders (6%) and a mixture of other shareholders (14%). On listing the company would be valued at $150 million.

Chief executive Cindy Mitchener and JB Were head of investment banking Paul Harris remained confident in the wake of the big slip in New Zealand stock prices as well as falls by technology stocks overseas.

eVentures' only business up and running so far is E-Loan, an online mortgage broker listed on the Nasdaq. The share price has fallen just over a $US1 to about $US3.25. One analyst said the company posed a big risk with mortgage companies failing if the "fiscal climate turns cold" unless they had other revenue streams.

"It has suffered a correction in Nasdaq but it is still on track with its revenue predictions and still on track in terms of the business it is doing.

"So to not be launching today would just be actually relating us to something that in the first place is not where we see ourselves," Ms Mitchener said.

eVentures says it is coming to market with an extremely conservative share price after toying with a much higher figure for the float - planned for May 9.

The offer is not underwritten and available only to certain investors and clients of NZSE members.The board does not intend to pay a dividend to shareholders in the near future.

"We always felt that the dot.com bubble was something we did not want to get caught up in," Ms Mitchener said. "We're not staffed by high-tech dot.com wunderkids."

eVentures has managed to attract a line of impressive business people for its management and board.

Mr Heatley is chairing the board, Telecom chairman Roderick Deane is also taking a place on the board along with The Warehouse's managing director, Stephen Tindall.

But the market is interested in the businesses and brands eVentures plans to bring into its stable.

Ms Mitchener said the hammering technology stocks had taken in the past week would not change the fundamental power the internet placed in the hands of consumers.

Other than E-Loan there have been no firm plans for other eVentures businesses. The company also planned to get into the venture capital market but as yet had not worked out a structure, Ms Mitchener said. eVentures started in New Zealand on January 5 and had therefore only recently begun working out how to bring international business to the local market.

Businesses eVentures was considering starting up here, included US dot.coms contests2win.com, MessageMedia and Buy.com.

The share offer closes on May 4.

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