After a strong year for tech IPOs in 2019, another software company is set to join the ASX boards later this month.

IT platform ARMnet (ASX:AR1) is seeking to raise $11m from investors at 20c per share, which will give it a listing valuation of around $30m.

The company’s arrival will mark another step in an ongoing shift towards tech as part of the broader composition of the ASX.

ARMnet’s product offering is similar to the software-as-a-service (SaaS) business model that most local investors understand — but with a twist.

Rather than customer-facing software, its focus is on efficiency improvements in back-end IT systems — known as integrated-platform-as-a-service (iPaas).

Like a SaaS platform the iPaas offering is “delivered through the cloud, and is highly scalable”, the company says in its prospectus.

The core premise of iPaas is to streamline back-end IT systems which are often run on multiple pieces of software that don’t have the capacity to share data due to legacy technology systems.

Integration software aims to solve the problem by extracting data and fostering a simpler exchange of information across the client’s intra-company systems.

On some occasions once the existing data has been migrated and integrated on new software platforms, the old data storage systems can then be turned off.

The product is targeted primarily at financial services firms, which often utilise “multiple systems across a wide range of functions” which “will not or often cannot talk to each other. This creates delays, costs and errors”, ARMnet said.

The company’s customer base includes companies such as Sydney-based Bluestone Asset Management and Canadian mortgage group Paradigm Quest. Across the portfolio, ARMnet serves around 40 clients and says its software is used to help manage around $100bn assets.

As part of the listing process, the newly public ARMnet vehicle will acquire Axcess Consulting Group (owner of the ARMnet software platform) for $4m.

Other funds will be deployed towards working capital, beefing up the sales team and establishing new offices in the UK and North America.

So far in 2020 a total of three companies have listed publicly, with early performances led by software platform Cosol (ASX:COS), which raised $12m at 20c a share on January 23 and closed last night at 34c.

Here’s a performance rundown of this year’s ASX entrants:

LISTING DATE TICKER NAME OFFER SIZE $ [millions] OFFER PRICE LAST CLOSE RETURN TO DATE %
01/24/2020 COS COSOL 12 0.2 0.335 68
01/31/2020 CBE Cobre 10 0.2 0.28 40
01/23/2020 HVM Happy Valley Nutrition 13 0.2 0.19 -5
02/14/2020 TDY Thedocyard 4 0.2 0.185 -8
02/20/2020 LGP Little Green Pharma 10 0.45 0.41 -9
02/12/2020 EMD Emerald Clinics 6 0.2 0.13 -35
02/14/2020 CST Castille Resources 20 0.2 0.19 -5
01/16/2020 NYR Nyrada 9 0.2 0.18 -10

 

Another nine companies have flagged IPOs in early 2020, five of which are junior minerals explorers:

AlSO READ: 2020 is off to a strong start as a number of mining explorers prepare to list

Here’s a list of upcoming IPOs:

Company ASX Code Expected listing date Industry Issue price Fund raising ($M)
ARMnet AR1 26/02/2020 IT/software (financial services) 0.2 11
Castile Resources CST 29/01/2020 Copper-gold explorer 0.2 20
Emerald Clinics EMD 07/02/2020 Healthcare 0.2 8
Kaiser Reef KAU 27/02/2020 Gold explorer 0.2 4.5
Little Green Pharma LGP 07/02/2020 Medicinal cannabis 0.45 10
Metal Hawk MHK TBA Nickel-gold explorer 0.2 5.5
Nemex Resources NXR TBA Mineral explorer - gold and base metals 0.2 5
Nicheliving Holdings NLH TBA Residential property developer 0.5 12
Tartana Resources TNA TBA Copper-zinc explorer 0.2 6
thedocyard TDY 14/02/2020 Cloud-based transaction software 0.2 5