CORRECT: Flick Electric raises $5 mln new capital

CORRECT: Flick Electric raises $5 mln new capital, adds Eastland as cornerstone investor

(Fixes Evander shareholding in 4th graph, names institutions in last graph)

By Pattrick Smellie

Dec. 15 (BusinessDesk) - Wellington-based online electricity retailer, Flick Electric, has raised $5 million in its second capital-raising in two years, adding the Gisborne-based Eastland Group as a cornerstone shareholder with an 11.1 percent shareholding, for an investment of a little over $2 million.

Community-owned Eastland owns the Gisborne area electricity network and is diversifying into port, timber and airport management businesses in the East Coast region and further afield. The Flick investment is Eastland's first in retail electricity sales, but aligns with its network ownership.

Two year-old Flick has attracted more than 7,000 customers, offering electricity at ever-changing spot market electricity prices, which have been consistently lower than major electricity retailers' tariffs in recent times, owing to weak electricity demand growth and a glut of electricity generation capacity. In return, customers pay their bills weekly and pay Flick a flat fee for their energy.

Eastland's investment puts it slightly ahead of Evander Group, Flick's original major investor, which now holds 10.2 percent of the company. Evander is a vehicle for investments by rich lister John Holdsworth, the former chairman of locally owned computer services industry leader Datacom, in which Evander is the majority 52.3 percent shareholder.

Flick now boasts 33 shareholders, with around a third of the participants in the 2014 capital-raising also participating in the latest round, Flick chief executive Steve O'Connor told BusinessDesk.

The company claims annual turnover of about $14 million of which almost $2 million is its daily and electricity usage flat fees, and has yet to become profitable, although the company is tracking to plan, O'Connor said.

The newly raised $5 million, for 25 percent of the expanded capital of the company, will be used for working capital, particularly customer acquisition, said O'Connor.

Accident Compensation Corp and Aspiring Asset Management have also taken smaller shareholdings in the company.

(BusinessDesk)

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