By Shane McGinley
FleetMatics Group saw its shares rise 36 percent
Shares of FleetMatics Group, the Irish fleet management software provider owned by Bahrain-based investment firm Investcorp, rose as much as 36 percent in their market debut as the company's niche software business stood out in an otherwise lackluster IPO market.
The Dublin-based firm had priced its initial public offering of 7.8 million shares at the high end of its expected price range of $15 to $17 apiece, raising about US $133 million.
FleetMatics, whose rivals include Trimble Navigation Ltd (TRMB.O), offers GPS fleet tracking software to small and medium-sized businesses that own fleets of commercial vehicles.
"It is a software services company, cloud based and a leader in a fragmented market. They have just started to make money and its revenue is based on subscription," said Francis Gaskins, a partner at IPODesktop.com.
As of June 30, the company had more than 16,000 customers, who use its software and services in 281,000 vehicles. Its subscription revenue rose 37 percent to $58.4 million for the six months ended June 30.
"Their market is small and medium-sized business, and the company isn't going after the big business. I don't see any other software company with that focus," Gaskins said.
FleetMatics sells its products under both the FleetMatics and SageQuest brands.
The company's strong debut comes after a string of poor performances in the IPO market this week.
Bahrain-based Investcorp said in August its full-year net income fell by more than half because of lower returns on its investment portfolio.
Despite a 20 percent recovery in fee income, the company's net income for the 12 months to June 30 shrank to US$67.4m, the company said in a statement. That compared with net income of US$140.3m for the prior-year period.
"Net income was down due to a fall in asset based income primarily due to the European crisis," Investcorp said.
"Fee income, however, was up 20 percent year on year due to strong acquisition and placement activity."
Total assets at the end of June 2012 slipped to US$2.7bn from US$2.9bn in the previous fiscal year. Liabilities also decreased, from US$1.8bn to US$1.7bn, while Investcorp's capital adequacy ratio increased to 26.9 percent.
Investcorp, which previously took luxury brands Gucci and Tiffany & Co public, said it proposed a dividend of US$7.50 per ordinary share plus a 12 percent dividend on preference shares.
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