Eyeing Nasdaq IPO, Brazil tech firm goes global

SAO PAULO (Reuters) - For once, Sao Paulo's horrid traffic could help a local company get somewhere.

Brazil's Spring Wireless, which developed "mobility software" to help clients stay productive while stuck in the constant gridlock of the nation's business capital, is contemplating a Nasdaq listing in a couple of years to help fund an expansion overseas.

The privately owned company, founded in 2001 by former Goldman Sachs banker Marcelo Conde, is vying for a bigger share of the $1-billion-a-year market for software platforms that allow corporate executives to run parts of their business from smartphones.

In Brazil, conglomerates including soft-drink maker Coca-Cola Co (KO.N), consumer goods maker Unilever (ULVR.L) and Spain's Banco Santander (SAN.MC) have embraced Spring's mobility software to overcome crippling traffic problems, poor infrastructure and burdensome red tape.

"The industry is moving at a fascinating speed," Conde told Reuters. "We aim to gain access to the most efficient source of capital as our revenue stream gets stronger."

Tapping Nasdaq, the world's largest pool of capital for technology companies, would be a first for a Brazilian company and could help Spring Wireless gain the visibility and size it needs to take on market leaders such as Research in Motion (RIM.TO) and Sybase, Conde said.

An offering on the New York-based exchange could take place around 2012, he said, once Spring Wireless solidifies its position in the United States, where it started operations last year, and in Europe.

The same global customers that picked Spring Wireless in Brazil and other Latin American countries are bolstering its drive into the developed world, where demand for mobility software is soaring annually at double-digit percentage rates. Spring's U.S. and European sales accounted for 45 percent of the company's $100 million in revenue last year.

The mobility applications boom has allowed the company to expand aggressively since 2008. It now has a staff of 600, with offices in 14 countries and network backup database centers in Moscow, Sao Paulo, Seattle and Beijing. Companies including Citigroup (C.N) and AmBev (AMBV4.SA) are among the clients running Spring Wireless' products in 20 nations.

DOT-COM BOOM OFFSPRING

Companies in the so-called mobile middleware market develop software platforms that offer corporations basic applications, as well as messaging, customer service, sales management and graphics capabilities. Spring Wireless generates revenue from subscriptions and also offers perpetual licenses.

Conde and more than 300 employees own 70 percent of Spring, while Goldman Sachs (GS.N) and fund New Enterprise Associates hold a combined 23 percent stake.

German software maker SAP (SAPG.DE), which bought Sybase last month for $5.8 billion, has a 7 percent stake. SAP declined to comment for this story.

Spring Wireless sprouted alongside other software and hardware makers in Brazil in the late 1990s, when entrepreneurs emboldened by the dot-com boom foresaw a surge in demand for technology services.

While some of those companies sank during the Internet bust in the United States, those that survived rode out the rough times well and ended up becoming market favorites.

Shares of Totvs (TOTS3.SA), which competes with SAP in the corporate applications industry, have quadrupled since the company went public in January 2006. Tivit TVIT3.SA, which provides technology consulting to industries that include telecom and finance, recently announced plans to go private after selling shares last September for the first time.

As a publicly traded company, Spring Wireless could have to pay dividends at the expense of research and development. Currently 21 percent of total revenue goes to fund R&D, compared with a sector average of 8 percent.

But a listing could also help bring the company the financial muscle it needs to compete with Research In Motion's powerful BlackBerry smartphone in the mobility business, analysts said.

And as the mobile middleware industry undergoes a wave of consolidation, an IPO could give Spring Wireless the necessary funds to snap up smaller rivals.

"The advantage of a listing," said analyst Stephen Drake of technology research company IDC, "is that you could gain global reach, a stable revenue stream and the possibility of alternative forms of growth," such as acquisitions.

(Editing by Lisa Von Ahn)