Megaport raises AU$25m, lists on ASX

Elastic interconnection services provider Megaport has announced that it will begin trading on the Australian Securities Exchange (ASX) after a successful Initial Public Offering (IPO) that saw it raise AU$25 million.

Megaport last month announced its IPO, hoping to raise AU$25 million in a bid to list on the ASX and expand its services across the United States and Europe. Under the IPO, 20 million shares were offered at AU$1.25 per share.

"The IPO funding allows us to stay independent and neutral, and achieve our business goals while maintaining our company values," Australian technology entrepreneur Bevan Slattery said on Thursday morning.

"The IPO has enabled the participation of more than 3,000 investors in Megaport's future as we strive to deliver on our vision to create a better way for networks and cloud to interconnect."

The AU$25 million raised through the IPO will be used to construct, operate, and maintain networks in North America and Europe; hire a greater sales workforce; and continue expanding into other regions overseas.

"This milestone allows Megaport to accelerate our business plans, to extend the platform deeper into existing markets, and to expand into new markets, including markets within North America, Europe, and Asia," Megaport CEO Denver Maddux said.

Megaport, founded in 2013 by Slattery, provides end-to-end network connections through 34 datacentres across Australia, Singapore, New Zealand, and Hong Kong to business customers.

"Rather than enterprises needing to purchase long-term, fixed bandwidth circuits between datacentres and their cloud providers, Megaport has developed a platform that uses software-defined networking (SDN) to enable our customers to provision secure, dedicated, and highly scalable circuits otherwise known as 'elastic interconnects' between their network and other networks connected to the Megaport fabric," said Slattery.

"With Megaport, customers can provision elastic interconnects for as long as a year and as short as one day, as slow as 1 megabit per second or as fast as 100 gigabits per second."

While Megaport initially also operated in the dark fibre business, it spun off its dark fibre assets to found separate company Superloop, so that it could focus solely on expanding its layer 2 elastic connectivity platform outside of Asia and Australia.

Superloop's 130km fibre network in Sydney, Melbourne, and Brisbane was subsequently sold off to Amcom. In return, Superloop secured a 15-year exclusive lease on the network, which services such customers as iiNet, M2, and Anittel.

Superloop's own IPO raised AU$17.5 million through more than 2,300 investors, with that company then listing on the ASX.

Slattery told ZDNet last year that it was important to divide Superloop and Megaport as the latter looks at growing beyond the APAC region.

"We looked at Megaport and where its rollout expansion was, and it was beyond those markets. I wanted to be very clear about what Megaport does and what it doesn't do. Megaport is a layer 2 elastic connectivity platform. It's about making it easier for the network and cloud guys to interconnect," he said.

"I didn't want people to also think it was a dark fibre provider."

Maddux also said last October that Megaport would be looking at opportunities in the US and Europe.

"There's a lot of interest in Europe for the Megaport model, as well as the major cities in the US, where we may have some competition on features but not in terms of the overall capabilities of the platform," Maddux said.

Megaport currently has more than 200 customers, and is an Amazon AWS, Microsoft Azure ExpressRoute, and Google Cloud Interconnection partner. It aims to expand its business into 45 datacentres across Europe and North America in 2016.

Megaport began trading on the ASX on Thursday under the ticker symbol MP1.