ASX tech share LiveTiles Ltd (ASX: LVT) went into a trading halt to carry out a capital raising.
LiveTiles is a software business which is headquartered in New York with operations in the US, Europe and Australia. LiveTiles provides workplace software for the commercial, government and education markets, and is an award-winning Microsoft partner.
LiveTiles’ Capital Raising
LiveTiles announced this morning that it’s looking to raise up to $50 million from institutional and other sophisticated investors in a non-underwritten raising.
Up to 142.9 million new shares will be given out in the placement, which represents 21.6% of the amount of LiveTiles shares. The company will also give regular investors a chance to take part, although this part will be limited to a total of $5 million.
The capital raising will be done at $0.35 per share, which is a 12.5% discount to the last closing price.
What Did LiveTiles Say About The Raising?
LiveTiles re-iterated its compelling growth prospects to investors. At June 2019 it had $40.1 million of annual recurring revenue (ARR) and it has a target of $100 million by June 2021.
The $40.1 million ARR is from 919 paying customers. Some of its customers are/have been PepsiCo, the UK Ministry of Defence and Tuck Business School.
LiveTiles has said that its total potential addressable market is $13 billion because there are 300,000 potential customers (that use Microsoft Office365 with over 100 employees) that could pay an average ARR of $43,600 per customer.
It’s deciding to raise cash to fund its sales and marketing resources, its partner channel development, ongoing product development & enhancement, business integration (including supporting systems & processes) and general working capital purposes.
Is The LiveTiles Share Price A Buy?
If I had the ability to buy into this capital raising at the discounted price then I’d be quite interested. If LiveTiles continues to grow its average ARR per customer then it could be an attractive investment.
But whilst it’s in a trading halt no non-shareholders can buy or sell. So it could be worth thinking about the growth shares in the free report below in the meantime.
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