Australian home entertainment business Quickflix Limited, which delivers DVD rentals direct to households, has announced its intention to raise $3 million under an initial public offer (IPO).
Australian home entertainment business Quickflix Limited, which delivers DVD rentals direct to households, has announced its intention to raise $3 million under an initial public offer (IPO).
Patersons Securities has been appointed as lead manager to the float.
The company’s founder and chief executive, Stephen Langsford, said Quickflix was the first company of its type to list on the ASX.
Mr Langsford said he and fellow executive director Simon Hodge were among Quickflix’s biggest shareholders, with others including US investors such as Tom Border from Border Books, and senior eBay executives.
Other investors include private companies linked to Perth businessman Craig Burton and high-profile stockbroker Andrew Frazer.
The company was launched in December 2003 and has since opened distribution centres in Perth, Sydney and Melbourne and entered marketing partnerships with Optus and Fairfax and other affiliates.
Quickflix will use funds raised from its IPO to expand its DVD library and open more distribution centres.
Mr Langsford said Quickflix’s aim was to follow the success of US market leader Netflix, a company listed on the Nasdaq with a market capitalisation of more than $US500 million and three million subscribers.
“We would like a share of the $500 million that Australians spend every year at video stores and PayTV,” he said.
“From the experience of Netflix in the US, we believe many Australians will take to online DVD rental in the same way that they have taken to online banking, broking and travel.”
Quickflix offers its members a selection of movie, music and TV series DVDs. There is a flat monthly fee and members can choose as many DVDs as they want and keep them for as long as they want, but can only have three in their home at any time. When one is returned the next on the list is sent out.
The DVDs and reply-paid envelopes are mailed to the member’s home address.
However, Quickflix isn’t the only company to offer an online DVD catalogue and home delivery, with others offering a similar service including Telstra BigPond Movies, Homescreen Entertainment, WebFlicks and V2direct.
Charges for three DVDs at any one time range between $33 and $40 a month.
Quickflix is the second cheapest company, charging $36.93 a month, with Homescreen Entertainment least expensive at $32.95.
Quickflix board members include: Mr Langsford, who is also executive chairman of Change Corporation, and ex-Poynton & Partners investment banker Simon Hodge (executive directors); ING Private Equity Access Limited managing director Jon Schahinger, and WA Soccer Association chairman, non-executive director to Jumbuck Entertainment and Movies Online, and former Channel 7 Perth managing director Kevin Campbell (directors); and PIENETWORKS non-executive director Craig Ferrier (company secretary).
