Ailing Acorn seeks £17.2m cash

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The Independent Online
Acorn Computers plans to raise £17.2m through a combined rights issue and placing to finance the next stage of its Online Media project, which aims to bring services such as home banking and shopping into every home in the country.

The announcement comes on the same day the company announced a £3.4m pre-tax loss for the year to the end of December, compared with a pre- tax profit of £115,000 in 1993.

Acorn, whose shares are currently traded on the unlisted securities market, announced it will be joining the full list when the company's new shares start trading by 21 March.

Online Media will provide a box to be put on top of the television set that will allow users to receive and decode a wide range of services in their homes and offices. The project is currently on trial in the Cambridge area.

Acorn does not expect to see revenues from the project for two to three more years. Olivetti, the Italian computer giant, which owns 78 per cent of Acorn, will not be taking up its share of the rights issue. Olivetti's share of the company will fall to 59 per cent, at a cost of £2m to the Italians. Instead, the shares will be placed with institutional investors.

The placing, at 80p a share, implies a market capitalisation for Acorn of £81m.

The company blamed its loss for the year on a decline in demand for computers from schools, its traditional market. The company said it failed to respond to the downturn quick enough to prevent the losses. It has now reduced its cost base, cutting 15 jobs out of a workforce of 130 in the UK.

Sam Wauchope, the managing director, said he expected Acorn to return to profitability this year.

The company made a loss per share of 4.9p, against earnings per share of 0.2p in 1993. It is not paying a dividend.