Asia boosts Avocet to a pounds 70m float
Tuesday 01 September 1998
Avocet Hardware, which sells window and door handles with multiple bolts, gained a substantial advantage from the devaluing of currencies last year in Asia, where more than half of its products are made.
The group, which has been planning a listing for 12 months, said it would float later this year through a placing with fund managers so long as there is sufficient appetite for small company equities.
David Kent, chief executive, said: "Clearly what has happened in the market hasn't been helpful. It was beginning to improve [for small cap stocks] but it's only in the last few weeks that the index has gone down.
"But we are not giving up."
Twenty-five senior executives of Avocet stand to share at least pounds 10.5m in the shape of a 15 per cent stake in the company. This will rise to 25 per cent, or over pounds 17.5m, depending on the company's performance.
Mr Kent owns over half of the management stake.
Avocet had planned to go public in 1992, but was bought instead by Sheffield Insulation Group, the insulation tiles company. In March last year, NatWest Markets and 3i led a leveraged management buyout with a view to going public this year.
A placing would help reduce big interest payments stemming from the MBO and give Avocet better cash flow which is needed for a planned expansion into Europe.
But the group said it needed "a decent multiple" to make the flotation work.
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