The Australian Government’s Clean Energy Finance Corporation (CEFC) has pumped $10m into Australian and New Zealand Sigfox licensee Thinxtra as part of a $20m Series B round of capital raising, giving it about 15 percent equity.
Thinxtra announced CEFC’s involvement today, 17 August but gave no indication of the value of investment. However the CEFC announced it was putting in $10m through the Clean Energy Innovation Fund that “draws on the combined skills and experience of the CEFC and the Australian Renewable Energy Agency (ARENA) to support the growth of innovative clean energy technologies and businesses which are critical to Australia’s clean energy transformation.”
CEFC CEO Ian Learmonth said: “Australia is a vast country with a scattered population. A large amount of energy is expended in physically monitoring millions of pallets, waste containers, gas canisters, farm gates, livestock and more. By providing a low-cost solution for tracking and monitoring these assets, we can save a huge amount of emissions.
“Our finance for Thinxtra will help build essential support technology which is set to play a key role in transitioning the Australian economy to net zero emissions by the second half of the century.”
Thinxtra’s final capital raising?
Thinxtra’s 42 percent shareholder, New Zealand Stock Exchange listed Rakon, held its annual results announcement on the same day, where chairman Bryan Mogridge said Thinxtra was “in the closing stages of its series B, and likely, last capital raising.”
Mogridge said: “The post money value of Thinxtra when the round closes will be $A66.2 million and Rakon will own 23 percent of the equity. This will value Rakon’s shareholding in Thinxtra at 2.6 times what we paid at around $A15.50 per share and we have 984,000 shares. This will naturally add to the value of Thinxtra within Rakon’s balance sheet but will only yield a reportable profit if ever we sell some of the shares.”
He said Rakon’s investment in Thinxtra had reduced the company’s EBITDA by $NZ2m.
Mogridge said Rakon’s involvement in Thinxtra was already providing very useful information about the IoT space and would “allow Rakon inside knowledge that not only allows us to understand the Sigfox network system that Thinxtra uses, but the competing networks of LORA and NB-IoT. Rakon can build modules for all three IoT networks on a global basis.”
He noted that both these networks are beginning to arrive in Thinxtra’s areas of Hong Kong, Australia and New Zealand, saying this would drive an uplift in the market opportunity for machine to machine (M2M) communications.
“This coming market is huge by comparison to existing data networks, albeit at much lower prices,” he said. “This is fine for Thinxtra as an insurgent and a dedicated IoT network provider. We see sufficient room in the growing and very large market for all the main participants to earn a reasonable return on their investments.”
Thinxtra goes live in Hong Kong
Mogridge said Thinxtra’s network has 70 percent of the Australian population Australia covered, 90 percent of New Zealand’s population covered and Hong Kong was going live next week with its first base station in a science-tech park that hosts 400 leading Asian Hi-Tech companies. The full roll out of Hong Kong will begin in October.
“Thinxtra has 1.8 million committed connections for the network providing committed revenue of close to $A20 million over the next eight years, Mogridge said.
50m connections $300m revenue in eight years
“Within its sales pipe line Thinxtra has just over 50 million anticipated connections across Australia and New Zealand which should generate around $A300 million in revenue over the next eight years.”
He added: “Some very interesting customers are signing up to use the Thinxtra network; Sydney based Water Group with eight water utilities already using the network; in Auckland Kordia has arranged for Auckland Transport to connect school signs; Silicon Controls, an Australian company has started using the network for information from gas storage bottles throughout Australia and is about to launch in the USA.