Login
iscover
Disruptive business Hello Real Estate will soon have millions of dollars of new funding in place to help pay for its expansion plans.
The multi-state group is expected to gain between $5 million and $7 million through an initial public offering, according to a prospectus lodged with ASIC.
The float is actually part of a complicated reverse takeover involving Minrex Resources, a publicly listed resources company.
Minrex will acquire Hello in exchange for some Minrex shares as part of the deal, before changing its name to Hello and exiting the mining business.
According to the prospectus, the new company will be valued at between $15.1 million and $17.1 million.
Hello, which has 12 licensees in three states, was founded in 2012. Its strategy is to disrupt the industry by offering a “high-tech, high-touch alternative”, which includes massive undercutting, flat fees and bundled services.
The prospectus said that between $1.25 million and $2.25 million of the funds raised in the IPO will be devoted towards finalising the development of Hello’s technology.
Another $1.8 million to $2.8 million has been set aside for advertising and marketing, while $380,000 will be used to repay Hello’s loans.
Up to 46.66 million shares are being offered to the public at 15 cents per share. Offers open on 24 November and close on 11 January, with trading expected to start on 20 January.
Under ASX rules, Minrex shareholders have to approve the reverse takeover given that it would represent a significant change in the company’s activities. A vote is scheduled for 23 November.
Hello founding director Philip Horan told REB that the IPO would help fund a “measured” expansion program and that Hello would become profitable in mid-2016.
The agency is licensed in NSW, Victoria, Queensland and South Australia, and has licence applications underway in Western Australia and the ACT. Mr Horan said it would also move into New Zealand in 2016.
“The business is expanding. We’re growing strongly, we’ve got a whole lot of new satellite business unit owners joining us and we’ll go from the 12 current areas to around 30 areas by January,” he said.
Hello will also launch a property management business in the first quarter of 2016, Mr Horan said.
[Related: Hello unveils proximity marketing initiative]
You are not authorised to post comments.
Comments will undergo moderation before they get published.