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LONDON (Alliance News) - The stream of new listings on the London Stock Exchange's AIM market continued Tuesday, as Rosslyn Data Technologies Group PLC started trading and hostel operator Safestay PLC priced its initial public offering ahead of the start of trading on Friday.
Rosslyn Data Technologies, which provides a cloud-based enterprise data analytics platform called RAPid, raised GBP10 million by placing 30 million shares at 33 pence each. At the placing price, Rosslyn had a market capitalisation of GBP24.9 million, although the shares were up 4.2% at 34.4 pence Tuesday afternoon.
"The platform is like any other platform, and on that platform there are applications and that is where our patent portfolio is focused at the moment. We've already filed our first patent which is a machine learning technology which clearly separates us from the competition," Chief Executive Charles Clark told Alliance News.
"The more data that goes through the platform, the cleverer it gets," Clark said.
Cenkos Securities PLC is acting as Rosslyn's nominated adviser and broker.
Rosslyn said it will invest GBP1.2 million of the IPO funds to expand its sales force, and GBP1.5 million will be invested in product development and management. The remainder of the proceeds will be used for general working capital.
For the year to end-April 2013, Rosslyn posted a gross profit of GBP1.6 million on revenue of GBP1.8 million.
"The company has been under-capitalised for a number of years. We've bootstrapped throughout the set up phase. The reason for taking it to AIM is to properly capitalise the company and take advantage of this opportunity in the marketplace." Clarke said.
The company has a low cost base, although Clarke said that this would rise as it increases investments.
"What is absolutely critical at this stage is that we do invest in marketing and making sure that this technology plays a significant role in the analytics space, and that we continue to invest in our research and development," Clarke said.
"The cost base will increase, but my aim is to increase the revenue base faster than the cost base," he added.
Safestay PLC priced its IPO on AIM at 50 pence per share, giving it an initial market capitalisation of GBP6.6 million. The company expects to begin trading on Friday.
Safestay owns and operates a hostel brand, and was established as a joint venture between Moorfield Group Ltd and Safeland Group PLC in April 2011. However, in January Safeland announced that it would be de-merging the business, buying out Moorfield Fund's interest in the process.
During its first full calendar year, Safestay posted an operating profit of GBP494,000 on revenue of GBP1.9 million.
Safestay has raised a total of GBP7.6 million, raising GBP4.8 million through the placing of 9.6 million shares at 50 pence and a further GBP2.8 million through the issue of convertible loan notes.
Safestay will use GBP6.7 million from the fund raising to pay a consideration that is due to Moorfield Funds.
Westhouse Securities is acting as Safestay's nominated adviser and broker.
"The hostel market is where the budget hotel market was 20 years ago and ripe for development. Safestay has a proven, profitable model to take forward," said Chairman Larry Lipman in a statement.
Safeland said that upon admission of Safestay's shares, each Safeland shareholder will receive one new Safestay share for every 4.66 Safeland shares held.
By Hana Stewart-Smith; hanassmith@alliancenews.com; @HanaSSAllNews
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