Serko to raise $15M to support future growth

Serko to raise $15M to support future growth

Serko has inked a series of new channel deals to take it into international markets

Serko founders Bob Shaw (left) and Darrin Grafton (right) at the company's NZX listing event in 2014

Serko founders Bob Shaw (left) and Darrin Grafton (right) at the company's NZX listing event in 2014

NZX and ASX- listed travel management software vendor Serko is raising $15 million in an underwritten share placement to "provide greater flexibility to accelerate growth opportunities".

The Auckland-based business' shares were put in a trading halt this morning with a book-build for the placement to be executed tomorrow.

The placement is underwritten at a price of NZ$2.75 per share, reflecting a 3.2 per cent discount to the last traded price of NZ$2.84 on Monday.

Serko has inked a series of channel agreements to drive its growth, most recently with Orbit World Travel (House of Travel) as a new travel management company reseller in July.

ATPI UK is now operational with first transactions also occurring in July while North America expansion continues via Custom Travel Solutions and Voyages Travel Encore, both headquartered in Canada.

"We have also recently announced Flight Centre’s intention to extend its Serko offering to include Canada, United States and Mexico," the company said.

Certain NZX participants will be invited to participate in the book-build on behalf of their New Zealand and Australian retail shareholder clients, Serko said.

The Placement is expected to provide Serko with funds to bolster its working capital position and strengthen its balance sheet, giving the company greater flexibility to both accelerate organic growth opportunities and execute potential acquisitions.

These activities  include investments such as establishing sales and support functions in new international markets; accelerating product development and integration required to appeal to a wider range of travel management companies and corporate users; and providing funding capacity for potential acquisitions.

Serko recorded NZ$18.3 million in revenue for the year ended 31 March 2018 and a maiden profit of NZ1.8 million - the Placement is underwritten by Deutsche Craigs.

Disclosure: Rob O'Neill holds a small parcel of Serko shares.

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Tags Developmentresellerstartupsserkotravel management software



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