Ionica set for early float after raising pounds 215m

Ionica, the wireless telephone company competing for a slice of BT's residential business, could float itself on the stock market as early as this summer, it emerged yesterday after it raised pounds 215m in debt and private equity, writes Chris Godsmark.

The Cambridge-based business, which launched a fixed-line phone service in East Anglia last year, released customer figures for the first time, showing 14,000 homes had subscribed, representing 2 per cent of the 705,000 within reach of base stations. Ionica launched in Coventry this week and is about to expand into Birmingham.

The cash-raising exercise involved $200m (pounds 125m) of debt accompanied by warrants convertible into Ionica shares, which would be issued if the company fails to float within a a year. The company said no decisions had been taken but it intended to float this year in London and on Nasdaq in the US.

Ionica also raised pounds 65m in new equity from private investors, including Bank of America, bringing the total equity to pounds 130m. Its main investor, Yorkshire Electricity, took up the offering, maintaining its stake at 19 per cent.