Investor backing for AIM float

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The Independent Online
FLOTATION of medical technology firm Creos International has won a vote of confidence from its venture capital backers, with most agreeing not to cash in when it hits the Alternative Investment Market on Wednesday.

Two-thirds of the shareholders, including the directors, have committed themselves not to sell for two years without broker Greig Middleton's permission, and several are lining up to buy some of the pounds 4.3m of shares on offer. Mercury Asset Management and Ivory & Sime are among the backers.

The six-year-old, Fife-based firm is seeking the listing, which will value it at pounds 23.4m, to help fund expansion at a time when medical scanner manufacturers are turning more to outside component suppliers.

At the heart of its technology is a new light-weight, high-voltage transformer able to drive X-ray machines with greater precision and less risk.

Whereas ordinary transformers use coils of wire housed in heavy, bulky cabinets, Creos has replaced that with printed circuit boards that it stacks eight high.

The units can be mounted on CT scanner arms, which can continuously spiral around patients, without the reversing that stops traditional heavy power cables getting tangled. "It's small enough to be hand-carried into an X-ray room, rather than being taken in on a fork-lift truck," said David Stevenson, managing director of the company's UK arm.

Although Creos is forecasting losses of up to pounds 1.5m in the year to 30 September 1996, it expects profits of pounds 2.3m by 1998. It estimates the potential medical market for its products at more than pounds 6bn and is looking at ways to apply the technology to power lasers and industrial X-rays.