Web developer gets Spikeful

Web developer gets Spikeful

Australian Internet company Spike Networks signalled its intention to become "the largest Internet media company in the world" last week when it issued the company's prospectus for an IPO listing on the Australian Stock Exchange on 29 July.

Spike's loquacious CEO, Chris O'Hanlon, announced a three-pronged branding strategy based on new ventures, original content development and Spike's core business of Web site construction, to secure Spike's future growth, a growth Spike and underwriter Salomon Smith Barney are counting on when they offer 26.4 per cent of the company to the public.

On offer are 22.5 million shares at $1.45 each, equating to a capital injection of $32.6 million with an over-subscription option for a further $3 million.

According to the prospectus, Spike is set to report $6.3 million in revenues for the fiscal year ending two weeks ago - 42 per cent coming from overseas - which is forecast to grow to over $20.4 million by June 30, 2000.

The money raised by the IPO will be split, according to Salomon Smith Barney's director of investment banking media and telecommunications Wayne Homschek, with approximately half being farmed back into the company's financial infrastructure and the rest being invested in new growth initiatives including original content distribution.

One such initiative is an online radio service - Spike Radio - set to go live on August 1 this year. O'Hanlon said Spike has already broken even with $3.2 million in revenues through advertising and sponsorship from Spike Radio and expects this to exceed $5 million by June 30, 2000.

The listing also signals the first time in Australia IPO share applications can be filled out over the Internet and appropriate funds sent via the Web or B-Pay.

Spike's online prospectus and application form are available at FactsSpike NetworksOffer price: $1.45Shares offered: 22.5 millionClosing date: 22 July 1999ASX debut: 29 July 1999Capitalisation: $123.4 million after floatGrowth areas: Web development, new ventures, original content creation

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