Confident Jade prepares to list on NZSE under a new name

By Chris Hutching

Friday 1st February 2002

Ruth Richardson

Sir Gil Simpson is likely to retain a significant stake in Jade Software Corporation when it lists early in 2003, according to chairman Ruth Richardson.

Sir Gil has decided to amalgamate all the services and products of the companies he founded - Aoraki Corporation and the Cardinal Group of subsidiaries - which develop or service the Jade computer software brand.

Miss Richardson said yesterday the amalgamation was in response to a message from the market. Last year when Sir Gil sought expressions of interest from financial institutions to a partial $30 million float of his computer software business the response was lukewarm.

Miss Richardson said the reaction indicated that the market wanted all the company to be floated in a simple and straightforward transaction.

The size of Sir Gil's stake in Jade after its Stock Exchange listing would depend on the amount of money to be raised, which, according to Miss Richardson "would be in the tens of millions."

His stake in the company was effectively reduced from 90% last year when the company issued $12 million worth of convertible notes to key investors US orthopaedic surgeon and entrepreneur Roger Bhole whose company has used Jade, and mezzanine financier i-cap, represented on the Aoraki board by Tony Hannon. Mr Bhole is also on the board.

Other new investors include Active Equities, and about 10% of the company is held by staff but Miss Richardson declined to reveal Sir Gil's effective current stake. He is estimated to have a fortune worth more than $40 million.

Miss Richardson acknowledged that Jade was emerging from a transitional period of recapitalisation as it rebuilt its markets. This follows a change in international product trends away from mainframe computers to PCs.

She said the company was in good heart and from her perspective the board was highly conscious of its governance role and the disclosure requirements of a public company. But she declined to reveal asset values or whether revenues had recovered to previous levels. The market would decide what the shares were worth, she said.

According to reports in the market, company turnover is about $50 million and might have a value of $100 million, depending on valuation methods for its intellectual property. It employs about 350 people.

Because so much of the company's value is tied up in intellectual capital, the strength of trading and new contracts obtained this year will be most significant in many investors' minds as the deadline for listing in the first quarter of 2003 approaches.

The company recently signed a significant deal to transfer all the computer systems of UK Skipton Building Society over to Jade, replacing the UnisysLinc mainframes they have been using. Ms Richardson said the contract was a breakthrough because of Skipton's size - it has assets of £6 billion.

Other recent product developments include the launch of a software system allowing tertiary institutions to manage student enrolments on the internet. Jasper went live at Christchurch Polytechnic this week, is already in use at Manukau Institute of Technology and it is due to go into Otago and Waikato polytechnics.

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