Reverse takeover sees PRM Cloud Solutions list on the ASX

Reverse takeover sees PRM Cloud Solutions list on the ASX

Summary: Australian enterprise cloud service provider, PRM Cloud Solutions, is mounting a reverse takeover of publicly-listed mining exploration company, Minerals Corporation, in a bid to list itself on the ASX.

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Australian mining company, Minerals Corporation, got the vote from shareholders last week to wholly acquire cloud service provider, PRM Cloud Solutions, in a reverse takeover manoeuvre that will allow the cloud provider to be listed on the Australian Stock Exchange (ASX).

PRM Cloud Solutions builds enterprise cloud applications for the mining, oil, and construction sectors using Salesforce's Force.com cloud app platform and claims some of the country's biggest business names, including Rio Tinto and Seven West Media.

Minerals Corporation (MSC) is a mining exploration company with projects in the Democratic Republic of Congo and Queensland, both of which will be discontinued following the acquisition.

According to PRM Cloud Solutions' chief executive, Leigh Kelson, the deal to publicly list through MSC represents a win-win scenario for the mining company's shareholders while allowing his company to substantially leverage its product offering.

"MSC was the entity, the shell," Kelson told ZDNet. "The company itself has a long history, but more recently it was exploring copper in the Congo and it had some technical success but no commercial success.

"Those mining explorations have since dried up. It's a win win-win for everyone — the shareholders now have a future in the company and we get to execute on our vision," he said.

Kelson's vision is to broaden the reach of his company's flagship product, Enverro, which was developed to help solve problems around workforce mobilisation in the resources sector.

"With the cloud computing sector set to grow over the next five years and beyond there is significant opportunity to leverage the positioning, experience and application expertise that PRM has developed," said Kelson in a prospectus (PDF) sent to MSC's shareholders prior to the general meeting held on 24 April deciding on the acquisition.

The acquisition now hinges on a share prospectus, which is aimed at raising at least AU$3 million from 15 million shares, each at AU$0.20, with oversubscriptions of up to 10 million more shares to raise an additional AU$2 million.

In its prospectus to shareholders, published on 10 April, MSC outlined the potential of the enterprise cloud market.

"Cloud-based computing services have enjoyed significant growth over the past 10 years," it said. "The Australian cloud computing market was worth US$882.4 million in 2012 and is expected to reach US$3.33 billion in 2016. The business application market is expected to be the fastest growing sector of the cloud computing market."

Kelson, who is set to become managing director of the new entity, said the company expects to re-list on the ASX as PRM Cloud Solutions Limited within the next three to four weeks.

The reverse takeover announcement comes only a month after another Australian cloud provider, CloudCentral, revealed it would engage in a reverse takeover of vineyard ownership company, Dramana Estate, in a bid to gain backdoor entry to the ASX.

In October last year, Australian cloud provider, Bulletproof Networks, also announced that it was conducing a reverse takeover of Spencer Resources Limited, to list on the ASX.

Topics: Cloud, Enterprise Software

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Leon covers enterprise technology and start-ups from ZDNet's Sydney newsroom.

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