Bulletproof sparks talk of dotcom 2.0 Peter Klinger, The West Australian October 30, 2013, 8:06 am
It's the questions on most people's lips. Are we about to experience dotcom boom, Mark II?
Spencer Resources shares yesterday jumped almost 40 per cent, following a 300 per cent spike on Monday, on news it was planning to ditch its base metals exploration efforts and instead backdoor list a Sydney IT company.
The key difference to the original dotcom boom over a decade ago, however, is that Bulletproof Networks makes money.
Shareholders, who have witnessed their shares in a downward spiral pretty much since the company's float at 20� in March last year, are making the most of the Bulletproof buzz. Since the announcement on Monday, Spencer's shares have shot up from 4.5� to their 25� close yesterday.
Spencer chairman David Paterson, a geologist by profession who is also the acting chief executive of UraniumSA, says it is a bittersweet moment.
"We have over the process of the last 12 months looked at a number of resources transactions and none of them achieved what we thought would create some value for shareholders, who have been suffering," he said.
"So we made the decision to move with Bulletproof because it was outside the sector that was also suffering."
Mr Paterson also spent almost two decades in stockbroking, including during the late 1990s when most of West Perth's listed companies ditched their exploration ambitions and offered themselves up for a backdoor listing of fanciful technology ideas.
Mr Paterson says the Bulletproof deal is different to the dotcom boom, which crashed spectacularly early last decade.
Bulletproof, which provides managed cloud computer infrastructure technology to corporates, had unaudited revenue in the past financial year of $14.8 million and earnings before interest, tax, depreciation and amortisation of $2.2 million.
Spencer shareholders will be asked to vote on the backdoor listing in coming months.
Mr Paterson, meanwhile, expects the dire investment climate for explorers to continue until at least early next year
Bulletproof Networks to absorb Adelaide's Spencer Resources in a reverse takeover
SYDNEY IT company Bulletproof Networks will exercise a reverse takeover of Adelaide company Spencer Resources, bringing its short exploration effort to a close.
Spencer listed on the Australian Securities Exchange in March last year with a focus on looking for Olympic Dam-style and lead-zinc mineralisation on the Eyre Peninsula and in Queensland.
The company's exploration tenements will now be divested however, with Bulletproof absorbing the company.
Bulletproof is a cloud computing company which claims to have achieved more than 40 per cent annual compound growth over the past five years.
It hosts websites for companies such as Nova FM and the technology site Whirlpool.
The company will change its name to Bulletproof Limited and a new board will be installed.
More than 41.6 million new shares will be issued by Spencer to the company's new owners, and a $1.6 million capital raising will be carried out by Taylor Collison.
Spencer shareholders will have to approve the deal at a general meeting to be held on December 6.
"Bulletproof had been actively looking for a way to achieve listed status to accelerate growth, while remaining predominantly self-funded," chief executive Anthony Woodward said.
"Presented with a number of contenders, Spencer Resources met Bulletproof's objective of an ideally structured and 'transaction ready' shareholder base.''
Spencer shares were up 200 per cent to 13.5c on the news
