Vista's float price low, but 'not a steal'

Murray Holdaway.

The final pricing for Vista Group's sharemarket float is towards the lower end of the indicative range, but the cinema software developer's initial public offering is still far from "a steal" for investors, a fund manager says.

Shares in Auckland-based Vista will be sold in the IPO at $2.35 after the price was set through a bookbuild with institutional investors and retail brokers. The range given in the prospectus was $2.10 to $2.70.

Brian Gaynor, executive director at Milford Asset Management, which is taking part in the Vista IPO, said he liked the fact that the software firm had global operations and was profitable.

"I like the company and the people but we're certainly not getting a steal," Gaynor said. "If they miss some of their profit forecasts ... all of us who are in there are not going to do very well out of it. There's not a lot of slack in it - the pricing is set on the basis of the company achieving pretty reasonable profit growth."

But Vista's existing investors - who include chief executive Murray Holdaway and executive director Brian Cadzow - had been prepared to "leave a bit on the table" for new investors and not "take everything for themselves".

"If this was a private equity float the price would have been higher," said Gaynor, who has criticised the bookbuild process used for the forthcoming float of private equity-owned glass supplier Metro Performance Glass.

Vista provides management software used by cinema operators for online ticket booking, food and beverage sales and staff rostering.

It will raise $40 million through the listing, expected to take place on August 11.

Existing shareholders - who will retain a 47 per cent stake in the company after the IPO - would sell 22 million shares, taking the total offer size to $92 million, the company said yesterday.

The IPO price values the firm at $188 million.

The retail offer opened yesterday and will close on August 1.

Vista, which has customers in 63 countries, has said it will use the proceeds of the float to repay debt and boost its stakes in two companies - New Zealand film analytics and campaign management software provider Movio and Netherlands film distribution software developer Maccs.

Vista has forecast a net profit of $8.1 million for the 2015 financial year, but dividends are not expected in the 2014 and 2015 financial years while the company focuses on growth.