Bevan Slattery’s venture NextDC soars on ASX debut

NextDC, the data hosting company founded and run by former Pipe Networks chief Bevan Slattery, has listed on the ASX this morning with the company’s shares rising well above the $1 offer price to hit $1.47 in early trade.

The company said in a statement this morning it had successfully raised $40 million through the listing, which it will now use in conjunction with a $40 million debt facility to spend on state-of-the-art hosting equipment.

Some of the major shareholders include Slattery, with a 50% stake, Symantec vice president Craig Scroggie and REA Group investor Mirrabooka Investments.

Slattery has invested $20 million of his own money into the venture. He was contacted for comment this morning but was unavailable before publication.

Chairman Roger Clarke said in a statement that Slattery “is committed to establishing NextDC as a key market participant in the Australian and New Zealand data centre services market – by designing, developing and operating a network of secure, efficient and stable enterprise class data centres.”

The float comes just after the company announced it had signed a deal with IT service provider Harbour MSP as its first anchor client in the Melbourne facility, located at Docklands. This facility is scheduled to go online in November 2011, with the Brisbane site set for operation in March 2011.

Another Sydney site is expected to go online by March 2011.

Slattery told SmartCompany last month the company sought to list rather than seek private equity due to the expensive nature of running state-of-the-art data centres in multiple locations.

“To build a successful data centre you need a couple of key ingredients, and one is money. It’s harder to get money today, and the banks don’t like to lend to data centres so much,” Slattery says.

He also points to data from Frost & Sullivan showing that 90% of major data centres in the Asia-Pacific region are at 90% capacity, or are very close to that point. Slattery says there is massive untapped demand for high-quality, high-volume data centres as cloud computing and other outsourced web services become popular.

“I demonstrated my involvement by putting in $20 million of my own money… I think there is a lot of demand there and that is going to grow.”

Slattery will act as chief executive, while former Pipe director Greg Baynton will act as a board member, along with former Pipe chief financial officer Robin Khuda.

Symantec vice president and Pacific region managing director Craig Scroggie is a non-executive director, and also a major shareholder.


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