Sheffield technology group Servelec is being floated on the London Stock Exchange by CSE Global, the Singapore-based group that acquired the firm 13 years ago.
CSE Global plans to sell all its shares in the business, which employs 500 people, most of whom are based at Servelec’s headquarters in Eckington.
Alan Stubbs, who took over as CSE-Global’s group chief executive two years ago and is also Servelec’s chief executive, says being part of a larger group is holding Servelec back.
“We have identified numerous commercial opportunities to pursue additional growth for our business,” says Mr Stubbs, who joined Servelec in 1984 as a software engineer.
“The present ownership structure, as part of a larger group, places a constraint on the ability of the management team to capitalise on these exciting opportunities.”
Mr Stubbs says a flotation will enable Servelec to drive growth organically and through acquisitions.
Servelec chairman Richard Last, who is also chairman of the British Smaller Companies VCT2 venture capital trust, says he has been enormously impressed by Servelec’s progress, but there is more to come.
“I believe that Servelec has a very promising future as a listed company,” said Mr Last.
“As an independent quoted company it will have the opportunity and means to capitalise on the many growth opportunities ahead and generate value for all of Servelec’s shareholders.
Servelec generated revenues of £39.4 million and an adjusted pre-tax profit of £11.9 million in the year to the end of December.
The company operated two divisions – Servelec Healthcare and Servelec Automation.
Its healthcare division designs, develops and implements electronic patient record and patient administration software and is a market leader in the mental and community health sectors in England.
Servelec’s automation division specialises in developing complex mission-critical control systems and providing consultancy services for large blue-chip companies, mainly in the oil and gas, nuclear, power, water, utilities and broadcast industries.
Customers include Welsh Water, Severn Trent, Centrica, BP and EDF Energy.
In addition to the sale of CSE Global’s stake, Servelec is launching an employee share offer, which will be used for working capital and corporate purposes.
Servelec says that when it is admitted to the London Stock Exchange’s main market, probably in early December, it is expected to have around £5 million in cash and no debt.