Software provider raises £31m in AIM flotation
Software Solutions Partners (SSP) plans to double its size of business by 2010 with almost half of the growth to be achieved by an acquisition drive.
The software house, which floated on the Alternative Investment Market (AIM) on Monday with a market capitalisation of £70m, is also looking to win more business from insurers.
Chief executive David Rasche, said about 75% of the company's business came from UK brokers. Over the next few years the aim was to increase the amount of business from insurers to 40%.
"We're really well known in the broker market and ... more ambitious in the insurance company sector," said Rasche.
Although he would not reveal acquisition plans or how much was available to spend on purchases, he said the company had spent £15m last year and "would acquire bigger than that".
The company has doubled in size since it was bought four years ago. He said that acquisitions would play an important part if they were to do it again in another four years.
A total of 45% of its previous growth was attributed to acquisitions.
However, Rasche said acquisitions were "unlikely" within the next six months because of the recent float.
Market capitalisation criticism brushed off
SSP has brushed off criticism that the company's market capitalisation of £70m was less than it had predicted.
Last year, the company said it would float once it had reached a market valuation of £100m (News, 3 June 2005).
Chief executive David Rasche said the figure of £100m had been "plucked out of the air".
"We made the decision we wanted to list and made the decision we wanted to do it this September, rather than grow more and save £100m. If the share price goes up 20% it would be £100m anyway."
The gross fundraising from the flotation of £31m comprises £15m raised for the company and £16m raised on behalf of existing shareholders.
According to Rasche, if it did not float now it would have to wait until January or February. He said that was not usually a good time to launch on the stock market. The alternative would have been to sell.
SSP shares were placed at 98p, and as Insurance Times went to press they stood at 105p.