NZX tells VMob it needs to be bigger to graduate to main board

[NZX], the stock market regulator, has told mobile advertising firm VMob [NZAX: VML] it needs to raise new capital and almost double its market value by the end of March if it wants to graduate to the main board.

Auckland-based VMob, which delayed a dual listing on the ASX last month, has been told the NZX is willing to let it join the main board if it raises $5 million through a planned private placement, and attains a market capitalisation of at least $40 million by March 31, the company said in a statement.

"NZX has stated that it is prepared to exercise this discretion in respect of VMob but it is also concerned with the level of VMob's current market capitalisation (being $21,518,000 at close of trading on 16 September 2015), as a company applying for a new listing on the NZX Main Board, particularly given the target constituents anticipated for listing on the NXT Market," VMob said.

"Once NZX is satisfied that these conditions have been met, and if VMob's board also decides having reflected on other alternatives that it wishes to proceed, NZX would communicate its approval to VMob of its listing on the NZX main board and there would be a number of standard compliance and disclosure matters for VMob to attend to at that time," it said.

The NZAX-listed shares rose 9.4 percent to 35 cents, before the announcement which came after trading closed. That values VMob at $23.5 million.

Last month, VMob signalled an intention to shift to the main board, move its headquarters to San Francisco, and raise $5 million, to help build a presence in the US, where its biggest customers are.

Today, the company said the delay in shifting to the main board means it doesn't have to the close the placement offer on Sept. 28.

The company's system integrates with customers' smartphones to collect and store data to help retailers target loyalty programmes, and has signed deals with convenience store company 7-Eleven and US brewery Anheuser-Busch as well as McDonald's

In February, VMob entered into a global deal with McDonald's giving the firm access to the fast-food chain's 119 markets, including an immediate roll-out in the US.

(BusinessDesk)

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