Martin Aircraft taps investors for $5M ahead of plans to raise as much as $20M in IPO
By Suze Metherell
Aug. 8 (BusinessDesk) - Martin Aircraft Co, which plans to make the world's first commercial jetpack, has so far raised
half of its $5 million target by selling shares to investors ahead of plans to raise as much as $20 million in an
initial public offering as part of a listing on the Australian stock exchange mooted for later this year.
The Christchurch-based company has tapped "sophisticated investors" for capital, saying it will spend $2.1 million on
research and development, $1.2 million on salaries and IPO costs, $701,500 on marketing and $985,000 on production of
five showcase jetpacks, the offer documents show. It also flags plans for a $15 million to $20 million Australian
listing in late 2014 or early 2015 to further scale up its production.
As at July 1, the company had raised $2.5 million in its pre-IPO, with a minimum investment at $49,500, representing
165,000 shares at 30 cents apiece. Currently Martin Aircraft's largest shareholder is No.8 Ventures, backed by investing
doyen and the company's chair Jenny Morel, at 31 percent, while founder Glenn Martin holds 28 percent. The company said
it completed a 10 for 1 share split to reduce the pre-IPO price to 30 cents.
In the year ended March 31, 2013, the company reported a loss of $1.76 million, on $5,206 of sales and $27,113 in other
income, including New Zealand government grants, the offer documents show.
Martin Aircraft hired Sydney-based Axstra Capital to manage the capital raise, advise on an IPO and help spruik to
wouldbe shareholders here and across the Tasman. The company is touting 40-pre orders for jetpacks representing $6
million in sales, with a further potential $20 million worth of serious interest. The jetpack can fly for 30 minutes
with a 30 kilometer range at speeds of up to 74 km/hour, compared to its nearest competitor with only 30 seconds of
flight.
The company wants to target the light helicopter market, dividing potential customers between government, for
surveillance and remote operations uses, first responder, for emergency, security and rescue uses,and recreational, for
tourism and flight school uses.
The company claims over 100,000 enquiries on its jetpacks, and says it has $42.9 million of potential pipeline orders,
including serious enquiries from a Mexican government agency worth up to $14.6 million, as well as from the United Arab
Emirates and South Africa governments, private companies in Australia, Canada, the US and Jordan, and non-civil interest
from Thailand, Qatar and Egypt.
A Russian commercial security firm, a Brazilian fire department and a Kuwaiti medical customer have also made serious
enquiries.
It has appointed Norton Rose Fullbright as legal advisors to the IPO, Bell Gully Lawyers as New Zealand legal advisors,
and PwC as investigating accountants.
(BusinessDesk)