Rangatira Invests in Fast Growing Services Company Konnect Net Limited
25 September 2012
Wellington investment company Rangatira today announced that it had made an investment of $3.5 million in Konnect Net Limited, an Auckland based service company. Established in 2008, Konnect is a leading provider of business process technology to the insurance, health and corporate sectors in New Zealand and Australia.
Rangatira’s chairman Murray Gough said, “Konnect have a range of proven business process solutions that have created strong interest both here and abroad, and were seeking a long-term cornerstone investor to help fund their ongoing growth.”
Konnect was named as the fastest growing New Zealand technology company in the 2011 Technology Investment Network’s TIN100 report. This reflected a 1,200 percent increase in sales as the company’s services gained traction in the market. Konnect has also been named as one of five finalists in the University of Auckland Business School Entrepreneurs’ Challenge which provides financial support to high-growth businesses with export ambitions.
Rangatira has a conditional undertaking to provide a further $2 million in follow-on capital in August 2013. Rangatira’s chief executive, Ian Frame, will join Konnect’s board initially, with a further Rangatira director to be appointed to the Konnect Board in 2013.
With this latest investment, Rangatira has this year committed around $15 million to five early stage high-growth ventures. They include: online accounting software provider Xero ($0.8m), life insurance provider Partners Life ($4.5m), Valar Ventures investment fund ($1.5m), Movac 3 investment fund ($2.5m) and Konnect ($5.5m). These five investments will account for about 10 percent of Rangatira’s total investment portfolio.
Murray Gough says, “These investments are consistent with our overall strategy of investing in business for growth. They reflect our expectation that the strong New Zealand dollar will see a continued shift in the economy from manufacturing to services. All of the investments are either New Zealand-based, or funds that plan to invest in New Zealand companies.”
Further investment opportunities sought
In 2011, Rangatira sold its interests in three investments that it had held for many years - Dunlop Living, Tecpak Industries and Te Kairanga Wines.
Some of the funds realised through those sales have been reinvested in these new opportunities. Rangatira still has about $20m of funds available for further investment and continues to search for good opportunities.
Rangatira’s unlisted portfolio currently includes Auckland Packaging Company (since 1999, 100% owned); Contract Resources Holdings (since 2004, 50% owned); Greenfield Rural Opportunities (since 2008, 16% owned); Hellers (since 2004, 50% owned); Polynesian Spa (since 1972, 51% owned); and Precision Dispensing Systems (since 1999, 82% owned).
Rangatira’s shares are listed on the Unlisted platform.