(Adds industry context, Kogan's earnings forecast)
SYDNEY, June 9 (Reuters) - Australian online electronic retailer Kogan on Thursday said it will raise A$50 million ($37.50 million) through an initial public offering priced at A$1.80 for each new share.
Kogan, which will have a market capitalisation of A$168 million on listing, is challenging existing brick-and-mortar retailers such as JB Hifi (JBH) and Harvey Norman (HVN) with its low-cost, online-only business model.
A majority of the funds raised will be used to fund growth, including investment in new products and categories, Kogan said in a statement.
The Australian online retail market has grown rapidly, but remains under-penetrated compared to other developed economies.
Euromonitor estimates that the Australian online retail market was valued at A$17 billion in 2015, and is forecast to grow at an annual 11.5 percent to 2019 helped by a shift in consumer preferences, technological innovation, increasing internet usage and faster download speeds.
Kogan is moving into the travel and mobile segments while growth will also be underpinned by the online assets of failed retailer Dick Smith (DSH) that it acquired in April.
Kogan was founded in 2006 by Ruslan Kogan with two private label LCD televisions. It forecast revenues of A$241.2 million for FY2017 and earnings before interest tax depreciation amortisation of A$6.9 million.
Current shareholders – Kogan and COO & CFO David Shafer – will retain about 69.2 percent of Kogan.com.
The offer is not open to the general public. The institutional offer, broker firm offer and priority offer are underwritten by lead manager Canaccord Genuity. ($1 = 1.3333 Australian dollars)
