US venture capitalists buy $65 million in stock.
Xero’s latest round of fundraising added another $47 million to the company’s coffers and handed multi-million dollar windfalls to its three largest investors.
Xero board member and former MYOB founder Craig Winkler, Xero CEO Rod Drury and co-founder Hamish Edwards reduced their shareholdings by selling $12 million, $4 million and $1.5 million worth of shares respectively to two US venture capital funds.
The funds, one backed by PayPal founder Peter Thiel, increased their holding to a combined 16.8 percent by also buying 10 million shares from Xero at NZ$6 each.
As reported in the Sydney Morning Herald on Saturday, sharemarket investors reacted bullishly and pushed the shares to a new high of $NZ6.89 on Friday, with the shares trading later up NZ40¢ at $NZ6.84.
US investor Matrix Capital Management’s stake in Xero rose to 9.8 percent from 1.8 percent and Valar Ventures to 7 percent from 3.9 percent.
Winkler’s share in Xero dropped to 15.7 percent from 19.5 percent, Drury’s holding fell to 18.5 per cent from 21 per cent and Edwards was reduced to 4.9 percent from 5.7 percent.
“As founders, you don’t have many opportunities to take money off the table,” Mr Drury said of the sale to the SMH. “The US investors wanted to buy more. It is interesting to see this level of support from overseas investors at the same time as MYOB’s note issue is under way.”
MYOB announced last week a subordinated notes offer to raise $125 million.
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