Opportunities Update - 27 November 2013
In my last newsletter – Good Finish to the Year - I mentioned some of the investment opportunities we have available. So as we creep into December I thought I should highlight and update a few that are expected to close before Christmas.
In my last newsletter – Good Finish to the Year - I mentioned some of the investment opportunities we have available. So as we creep into December I thought I should highlight and update a few that are expected to close before Christmas.
For more information about these Offers call me on +649 307 3257 or +64 21 902 901, or reply to this email now.
Freeflow Pipes – Australasian Patents
The Information Memorandum for this Offer is now available. For an overview of this Australasian business see our website.
We already have a firm application from a charitable trust, which does not intend to take an active participation in the business, and interest from a potential cornerstone shareholder who is looking at a significant investment and a seat on the board.
The Managing Director of Freeflow Pipes, Peter Barrett would be happy to show qualified prospective investors through the operation in Hamilton. If you’d like to take up that offer give me a call.
New Zealand Market
Freeflow Pipes is actively pursuing the 8,000 new home Auckland market and getting Freeflow Pipes specified on plans for developments. They are actively working with full site development companies in Auckland including Legacy Homes, E Homes, Latitude Homes, and Southpark Homes.
The business has also secured a large share of the national home building market through housing companies like G.J. Gardner Homes, Golden Homes, Classic Homes, Platinum Homes, Signature Homes, Stonewood Homes, Jennian Homes and Lockwood Homes.
It has also entered into an agreement with Roofing Industries to supply Freeflow pipes through their supply chain outlets. The Christchurch home market is of course huge and Roofing Industries’ Christchurch office is now obtaining new space for bulk stock deliveries of pipes to satisfy the demand there. This will greatly improve Freeflow Pipes’ gross margin in that market.
Australian market
Freeflow Pipes also has huge potential in Australia where the market is more suited to the mass production of building components and is 5 times the size of the market here.
The potential for the Australian business is so good the directors have been reluctant to include their optimistic financial projections in the IM. According to their research within one year the business could have 50% of the Top 15 Australian customers for downpipes and 10% of the top 15 for storm water.
Their belief is based upon knowing the degree of market advantage they have in the quality of service and regulatory support, let alone the aluminium price advantage resulting from the Australian/New Zealand free trade agreements.
Were this penetration to be realised the sales revenue would be over $13 million for pipes and just under $9 million for storm water, a total $22 million compared with the $4.5 million given in the IM. I dare not mention the ROI for initial investors if even half these numbers come to fruition.
New Zealand Dairy Products Exporter
A company focused on New Zealand sourced milk powder products and health supplements targeted at Asia Pacific consumers, is about to finalise a second round of capital raising. Founded in New Zealand two years ago, the group has successfully raised about NZ$4.8 million of capital.
The business has offices in Auckland, Shanghai, Guangzhou, and Hong Kong. Sales to date are approaching NZ$1 million and forecast orders for the next 4 - 5 months are NZ$10 million. Their products are currently available in over 200 Hong Kong stores and are targeted to be in over 1,000 stores in China by February 2014.
In the last round, US$2 million of Convertible Bonds was raised from Qualified or Excluded investors to fund general working capital. These Convertible Bonds pay 10% interest and, at the option of the holder on or before 31 March 2014, either redeem for cash or convert to ordinary shares at a company valuation capped at US$8 million.
The board has approved the raising of a further US$500,000 of Convertible Bonds, on the same terms, with the option to extend this to US$1 million. The company’s preference is for a cornerstone shareholder to take up the additional Convertible Bonds and participate in future capital raisings as the business expands.
Footfalls & Heartbeats
This offer must close this week and there is only $75,000 of the $1.5 million being raised in this round available. For a summary of the offer see our website.
Yes it is a strange name for a business, but Apple must have seemed odd at the start and the investors in this project are far from unknown. Names include:
- Dr Gary Pace, a Director of Resmed who is investing $100,000 and will become a director:
- Dig Howitt head of manufacturing at Cochlear (ASX:COH) who is investing $80,000.
- Jeremy Collins, a current Investor/Director of Footfalls who is investing over $100,000;
- Sir Eion Edgar, Chairman of Forsyth Barr and
- Two private investors in Australia with medical technology and separately a software and textiles background who are investing $100,000 and $150,000 respectively.
Managing Director Brent Ogilvie has just returned from a trip to the U.S. where he met with Sony which had approached Footfalls with an interest to license the technology as a smart vest to monitor people’s key health metrics. Footfalls also presented to the World Best Technology showcase in San Diego, where it was one of only 70 companies selected globally and the only one from Australasia.
Development Update
Carolon, a US manufacturer of compression bandages, has confirmed its intention to launch in January 2014 a multi-layer compression bandage system for venous ulcers in the US using Footfalls’ proprietary resistive technology to measure actual applied compression at point of application.
Bauerfeind, a large German manufacturer of compression bandages has reviewed Footfalls technology and invited Footfalls to meet with its senior management for half a day next week. The Little Linen Company (Australia) has expressed strong interest in a license for parents to monitor infants. Kimberly Clark (NYSE:KMB) has initiated discussions with Footfalls for infant and elder care.
Under Armour is also interested in using Footfalls technology to develop and test new compression garment designs. Adidas, Under Armour and SKINS are all reviewing licensing for sports compression garments.
Adidas venture investment arm has also invited the company to present to its board for investment and Footfalls is now being approached weekly by potential licensees. Sony has approached Footfalls with an interest to license the technology as a smart vest to monitor people’s key health metrics.
None of the above are offers of Securities to the Public and are available only to eligible investors as defined by the Securities Act, or those excluded from the Offer provisions of the Securities Act. They are intended for distribution only to selected people to whom, under the relevant laws, they can be lawfully distributed. They cannot be distributed in any other jurisdiction, or to any other people. They are not offers or solicitations in any jurisdiction in which such offers or solicitations are not authorised, or in which the person making such offers or solicitations are not qualified to do so, or to any person to whom it is unlawful to make such offers or solicitations. Any representation to the contrary would be unlawful. No action has been taken by any person that would permit a public offering in any jurisdiction where action for that purpose would be required.
Cheers
JP
John Paine B.Sc., Dip BIA
TBK Capital Limited
Level 15, BDO Building
120 Albert Street
Auckland 1010, New Zealand
Phone +64 9 307 3257
Fax +64 9 309 4519
Mobile +64 21 902 901
Email john.paine@tbkcapital.co.nz