The brothers who founded software company Trintech could be worth £3775 million ($50100 million) when their company takes a dual listing on German and US stock markets next month.
Mr Cyril McGuire, who shares the chief executive officer position in Trintech with his brother John, said they would float 23 per cent of the company following the issuance of 5.8 million shares on the German Neuer Markt exchange and the US Nasdaq exchange on September 27th.
Mr McGuire said Trintech would publish detailed financial figures when its prospectus is issued shortly during a "bookbuilding" roadshow. But they declined to release any details yesterday.
Trintech, founded in 1986, has recorded a loss for the past two years, which it says is attributable to a strategy of reinvestment in research and development and market building. This year it will record sales of $21 million, reflecting year-on-year growth of around 40 per cent.
Industry analysts believe the company would hope to raise $75 million from the sale, giving Trintech a market value of around $326 million. The McGuire brothers hold a 48 per cent stake, which will be diluted to 36 per cent after the share issue. Institutional investors will also dilute their shareholding from 49 per cent to 38 per cent.
Share options available to Trintech staff will increase as they continue to retain a 3 per cent shareholding following the new share issue.
In the absence of detailed company figures, an indication of Trintech's potential valuation post-flotation can be derived from one of its chief competitors, German founded company Intershop. It was valued at $900 million at the time of flotation on the Neuer Markt last year.
Intershop is valued at $1.5 billion on estimated revenues of $53 million. Applying a similar valuation to Trintech it could be worth $600 million post flotation.
Last year, Trintech was valued at around $115 million after it raised $20 million in private investment capital. Mr McGuire says the company, which provides secure electronic payment products to financial institutions and communications companies, has around 30 per cent of the German electronic payments market.
Trintech will be aggressively pitching to investors in the German market, with an advertising and awareness campaign already under way there.
This is the first time an Irish company has chosen to list on the German Neuer Markt and it is also the first time American depositary receipts have been simultaneously issued on the German and US Nasdaq exchanges.
Mr McGuire said the dual listing had taken a great deal of planning, articularly given recent hits taken by Irish technology companies on the Nasdaq exchange. "This was a concern for us, so we chose Europe, where investors tend to be more long term in their decisions to offset Nasdaq investors who are more momentum driven."
While Davy Stockbrokers will act as Irish selling brokers, international banks are underwriting the issue, led by Deutsche Bank as global co-ordinator. BancBoston Roberston Stephens, Donaldson Lufkin & Jenrette and West LB Panmure are also represented in the consortium.
The initial public offering will fuel Trintech's investment plans into new markets. It already employs 250 people - having doubled its workforce in the last year - between its joint headquarters in Silicon Valley, California, and Leopardstown, Co Dublin. It also has offices in Germany, Latin America and Australia.
Mr McGuire said Trintech had no plans to move its Dublin headquarters despite its focus on other markets: "We have a highly skilled workforce and a favourable tax environment. We're very happy with it, and there is no reason to change that."
Trintech's biggest competitor is US company Verifone, which was bought by Hewlett-Packard for $1.15 billion in 1997. At the time of the take-over Verifone was generating annual revenues of $472 million.
