Former Smart50 winner Atlassian is moving its domicile to the United Kingdom this year to get ready for an initial public offering outside Australia.
Documents filed with the Australian Securities and Investments Commission late last month show Atlassian will reincorporate in England and Wales, following a vote of the technology company’s shareholders.
Atlassian has grown from a small start-up into one of the biggest companies of its kind, employing 530 people across the world and turning over more than $100 million.
In 2010, Accel Partners paid $60 million for a stake in the business, setting off a trio of investments in Australian companies.
The company was contacted for comment, but no reply was received prior to publication.
Atlassian isn’t the first company to move offshore to further its growth, and it certainly won’t be the last. Here are five reasons Australian businesses are heading offshore.
1. The window is open for IPOs
Gary Nicholson, a partner in Ernst & Young’s transactions team, told SmartCompany there is currently strong institutional demand for IPOs both in Australia and overseas.
“We talk about the IPO window at certain points in the investment cycle, and we are at that point at the moment where there is strong support and quite a number of companies looking to raise capital,” Nicholson says.
Nicholson says there were more IPOs in the fourth quarter of 2013 in Australia then there were in the whole of 2012 and strong listings overseas as well.
2. Peer companies
Nicholson says many Australian companies look to list overseas as there are more companies similar to them.
“The issue of peer companies is really important, the more peers you have, the better understanding of your company and more liquidity of your stock,” he says.
“In the UK, the advantage would be there are more comparable companies. The Australian market is quite small, so a lot of tech companies fail to have enough investor support in Australia.”