Download the Prospectus
Pre Money Equity Valuation
$17,499,382
Min Raise
$8,500,000
Max Raise
$11,000,000
Estimated Close
2020-02-19
Issue Type
IPO
Lead Manager
Bridge Street Capital Partners Pty Ltd
Type of Securities
Shares
Date First Lodged
20/12/2019
Offer Costs $
$1,082,038
Market Cap Max
$28,499,382
Key Executives
Nick Brookes (NEC), David Grey (MD and CEO), Alan Beasley (NED), Brendan Dickson (NED)
Company Address
Ground Floor 50 Miller Street North Sydney NSW 2060
Exchange
ASX
Chairman's Letter

Dear Investors,
On behalf of the Board of Directors, I am delighted to invite you to become a Shareholder and participate in the future growth of ARMnet Limited
(A.C.N. 619 705 207) (“Company” or “ARMnet”).
About ARMnet Limited
ARMnet Limited is an Australian public company incorporated for the purposes of purchasing 100% of Axcess Consulting Group Pty Ltd (A.C.N.
109 358 689) (“Axcess Consulting”). The Axcess Consulting Group’s core business is the ARMnet Platform. ARMnet has entered into Share
Purchase Agreements (“SPAs”) with the shareholders of Axcess Consulting and on Completion of the Offer, ARMnet will acquire all the shares in
Axcess Consulting and become its ultimate parent company under the SPAs.
Axcess Consulting is a well-established business with more than 40 clients in North America, Australia, Asia and the United Kingdom. Axcess
Consulting is a trusted provider with over AUD$100 billion of client assets being serviced by the ARMnet Platform. The ARMnet Platform has
enjoyed the security of multi-year contracts, has a high customer retention rate and strong growing revenues with a total growth rate of 119%
over the last 3 years and at a rate of 97% over a 5 year period (please see Sections 1.4 and Section 6.8).
The ARMnet Platform is an innovative cloud-based integration and processing software platform as a service – known in the industry as an
iPaaS servicing the financial services sector worldwide. The ARMnet Platform is used by large corporate clients in the insurance, non-bank
mortgage lending and funds management sectors. ARMnet is the first iPaaS company in Australia in financial services seeking to list on the
ASX.1
Similar to a Software as a Service (“SaaS”) business, the ARMnet Platform’s iPaaS offering is delivered through the cloud, and is highly scalable.
As customers and customer retention rates change, the Company’s revenue streams can scale, yielding long-term annuity streams based on the
value of assets and origination of new assets and new products on the ARMnet Platform. We will therefore be able to participate in the growth of
the financial services industry globally. This is an important feature for ARMnet and we expect this to be a key feature of future revenues and our
revenue model going forward.
What problems does the ARMnet Platform solve?
Financial institutions globally utilise multiple systems across a wide range of functions, and as most of these systems willl not or often can not
talk to each other, this creates delays, costs and errors.
The ARMnet Platform dramatically reduces a client’s costs and saves time through its ability to translate, integrate and automate data ingested from
the client’s various software systems and sources via cloud and on-premises software (such as finance, sales and marketing and customer support
software applications). This allows multiple systems and processes to work together in a unified way for its clients’ data and information use.
The ARMnet Platform also empowers its clients with the ability to originate, service and report on multiple financial asset types and it also gives
the client the ability to decide when to turn off redundant software systems that can now run on the ARMnet Platform as one consolidated
platform, which reduces our clients’ technology infrastructure and software coding costs. It is this aspect that makes the ARMnet Platform so
useful to a broad range of financial services companies rather than a single narrow subset of financial services companies.
Importantly, it also helps large complex financial services organisations manage and move data to the cloud and digitally transform their
business.
The ARMnet Platform:
» provides a fast, secure and highly scalable solution offering both product modules and service solutions;
» is a rapid deployment with low software coding and reporting to any smart device;
» eliminates human touch points in product processing stages with automation and AI logic;
» saves costs, increases revenue generation and cuts time;
» has multiple translation and workflow engines to offer asset origination, data collection and speedy processing;
» tracks and reports processing touch points across the front, middle and back office; and
» offers its clients analysis, business intelligence and flexible reporting metrics.
The iPaaS market, where ARMnet operates, is one of the fastest growing IT sectors with a CAGR growth rate of 39.35% in 2019.1
Gartner
estimated that the enterprise iPaaS market for subscription revenues reached more than US$1,690 million in 20182
. In 2018 this represented
a CAGR of 56% when compared with 2017 where the CAGR was 72%. Gartner estimates the iPaaS market will reach US$2.5 billion within the
next 12 to 18 months and grow at double digit figures over the next 5 years.1,3
This market position will be enhanced in 2020 with an estimated
83% of enterprises moving to the cloud opening up more opportunities.4
This market dynamic, and the growing leverage to the size of the
financial assets our clients service using the ARMnet Platform, offers a tremendous opportunity for the Company with a shift on IT spending
away from traditional (non-cloud) offerings to new cloud-based alternatives like the ARMnet Platform. ARMnet intends to take advantage of a
growing iPaaS market in financial services for its continued profitability.
The Offer to investors
The Offer provides a minimum raise of $8.5 million and a maximum raise of $11.0 million on Completion of the Offer by the issue of between
42,500,000 to 55,000,000 New Shares at $0.20 cents per Share. As one of the purposes, the proceeds raised in connection with this Offer
will be used to execute a clear global growth strategy. This will include the opening of dedicated sales offices in the United Kingdom and North
America and expanding sales and business analysts in Australia and increasing the expenditure on marketing. In addition, some proceeds will be
used to acquire Axcess Consulting under the SPAs (as outlined in Section 9.4.1), to retain quality personnel, to provide sufficient working capital
and to cover all costs for the Listing. Please refer to Section 2.3 for further details on the use of proceeds.
A number of Shareholders holding 73,487,724 Shares on Completion of the Offer will be under escrow arrangements for up to 24 months from
the Listing Date. These persons include Related Parties, Promoters and other persons that the ASX requires to be restricted from selling their
Shares. The Axcess Consulting Shareholders will also be under escrow for 100% of their Vendor Shares for 24 months from the Listing Date.
The total escrowed shares represent 51.57% of the Company’s issued capital at the Listing (if the Maximum Subscription is reached). Please
refer to Section 9.6 for further details.
This Prospectus contains detailed information about the Offer, the industry in which the Group operates and its financial and operating
performance. The Company is subject to a range of risks which are fully detailed in Section 8, which should be considered in detail. I encourage
you to carefully read this document in its entirety and consult with your professional advisor before making your investment decision.
On behalf of the Directors, I invite you to subscribe for Shares in the Company and I look forward to welcoming you as a Shareholder.
Yours sincerely
Nick Brookes
Chairman