Red Cube plans IPO within 12 months
(UPDATE: Adds details, quotes)
Wednesday June 14, 8:00 am Eastern Time
By Marcel Michelson
ZURICH, June 14 (Reuters) - Internet protocol communications company Red Cube said on Wednesday it planned an initial public offering (IPO) within 12 months.
Chairman Niklaus Zenger told a news conference Credit Suisse First Boston (CSFB) and U.S-based Lazard were advisers.
The exact timing of the IPO would depend on the market conditions and the consolidation of recent acquisitions and alliance deals. Zenger declined to say where the company would list its shares, saying it kept all alternatives open.
When asked whether Nasdaq was an alternative, Zenger said: ``Nasdaq, Hong Kong, Neuer Markt -- they are all alternatives''.
Red Cube made a net loss of 8.4 million Swiss francs ($5.18 million) for 1999 on sales of 46.2 million. That compared to sales of 2.17 million francs in its first year of operations in 1998, when it made a net loss of 6.1 million.
GROWTH CONTINUES IN 2000
Zenger said the company's first quarter result for 2000 -- which have not yet been finalised -- were ``almost equal to the year 1999'' in sales terms.
Zenger, a lawyer by training who managed various technology projects before setting up the company with some friends, declined to say when Red Cube expected to make a profit because he feared forward looking statements could hurt the IPO.
But he said he expected good sales growth to continue which was partly based on deferred revenues which are already known. For a number of projects Red Cube received a front payment which it cannot entirely include as revenues in the current year under United States GAAP accounting rules.
At the end of 1999, these deferred revenues were another 42 million on top of the reported 46.16 million. PricewaterhouseCoopers are accountaants to Red Cube.
At the June 9 annual meeting the equity was raised to 105 million Swiss francs from 7.5 million via a private placement among existing shareholders.
The founders and management own some 50 percent of Red Cube, with Zenger having the biggest stake. Financial institutions hold 20 percent while another 30 percent is owned by private investors in Switzerland, Germany, the U.S. and Britain.
IPO NOT NEEDED FOR CASH
Zenger stressed Red Cube did not need an IPO to raise cash but it wanted to have a listing to be able to conclude alliances or mergers on a paper-for-paper basis.
In May, Red Cube struck a strategic partnership with I-Link Inc (NasdaqSC:ILNK - news) of the U.S., which is listed on Nasdaq with a market capitalisation of some $600 million.
John Edwards, chairman and chief executive of I-Link, was also at tne news conference and said the link of the two companies' IP networks gave them ``the biggest IP-enhanced network in the world'' which allowed seamless telecommunications as well as value added services.
Asked whether a future merger between I-Link and Red Cube was possible, Edwards said he could not exclude it.
``We start with working together and it is great,'' he said, addig; ``But we are public and they are private.''
I-Link was Red Cube's biggest competitor. Other main companies active in the Voice over IP (VoiP) market -- which according to IDC could grow to $24 billion by 2002 from $4 billion in 1999 -- are Grec, ITXE, IBasis (NasdaqNM:IBAS - news) and Deltathree.com Inc (NasdaqNM:DDDC - news) |
