Pulse Data plans bypass of fledgling exchange

Visual aids firm Pulse Data plans to bypass the New Zealand Exchange's fledgling alternative market (NZAX) to head straight for the main board.

Managing director Russell Smith said Pulse would issue new shares and raise capital as part of its initial public offering (IPO) later this year.

The award winning Christchurch company, which exports its products to more than 30 countries, announced its intention to list last July.

A firm date for the float would be set in May, Smith said.

Smith said it was unlikely, but still possible, that the company would list on NZAX.

However, the cheaper compliance costs and more flexible rules associated with the NZAX were not a big enough incentive.

"It does not justify going on to what would be a smaller market with lower liquidity," he said.

"Our view is that for a company around our sort of size we would lose more on the discount on the smaller exchange than we would gain through saving some money on compliance.

"We'll certainly be raising some money in the process and it will be reasonably significant."

"It will come from some sell-down by existing shareholders and from new capital."

Previous indications suggested Pulse would seek to raise $20 million.

Pulse was founded in 1988 after a management buy-out from the old Wormald group.

Companies Office records show Smith owns the largest shareholding in Pulse with 18.1 per cent. He is followed by Orion New Zealand, the only significant corporate holder, with a 16.6 per cent stake.

Macquarie Financial Services adviser Barry Johnston said Pulse was seen as having good growth prospects.

"It is in a unique and high-tech field," he said.

"It is a good growth opportunity and worthwhile investing in providing the numbers stack up."

- NZPA