Intellectual Capital invests $35 million in Woosh

3.30pm

Venture capital firm Intellectual Capital Partners (i-cap) has invested $35 million in wireless broadband provider Woosh Wireless, with a view to being on board for a possible float next year.

Tony Hannon, managing director of i-cap, said Woosh's business plan calls for a listing in around 18 months' time.

"That will be reviewed as a strategic initiative by the company, part of the brand development and also to continue broadening the base of investors," Mr Hannon said.

There has been talk of IPO (initial public offer) fatigue in the market, following a spate of new floats this year, but Mr Hannon said Woosh was different from other new offerings.

"When we go to list we will not do it without strong market demand for Woosh. It's quite a different company from the ones that have listed in the last few months, and plan to list....with a different focus and different feel," Mr Hannon said.

Woosh chief executive Bob Smith said that despite the size of the telecommunications sector there was very little choice of investment vehicles in that market.

"There's demand from investors for choices other than just Telecom in the sector," Mr Smith said.

Mr Hannon said the board would start looking at the IPO in the last quarter of next year.

In the meantime, he said i-cap's funding will help Woosh broaden its network and build its brand awareness and customer base.

Woosh is looking to grow coverage within its current network in Auckland, Wellington, Christchurch and Southland and step up its sales and marketing activities.

The company's ultimate goal is nationwide broadband coverage, but Mr Hannon said this would take several years to develop.

Woosh has signed on 5000 customers since it changed its name from Walker Wireless and launched its commercial high speed wireless internet service in September last year.

Mr Hannon said only about 2 per cent of New Zealanders had broadband coverage, but this was growing as pricing becomes more competitive.

Of the New Zealanders signed up to broadband, Mr Smith said Woosh had captured about a 30 to 40 per cent market share in its coverage area.

Woosh caters to both the traditional broadband market as well as the portable broadband market.

The Auckland-based company's existing shareholders include founder and chairman Rod Inglis, Todd Capital, Sky TV co-founder Craig Heatley, The Warehouse founder Stephen Tindall, and US private equity firm Clarity Partners.

I-cap manages about $400 million, through five funds which focus on Australasian investments.

- NZPA