AIM float values fledgling at £20m

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The Independent Online

Two IT entrepreneurs are set to become paper millionaires when the betting software company they founded floats on the Alternative Investment Market later this month.

CES Software - a start-up technology outfit founded by Lorne Abony and Andrew Rivkin - whose software enables companies to offer betting services over the internet, is looking to raise about £5m by floating on London's junior market.

The move - a further sign that investors are prepared to swallow technology businesses again after the collapse of the bubble - could see the business valued at about £20m even though it has been going for only 18 months and has no material revenues to speak of.

Mr Abony, the company's chief executive, and Mr Rivkin, its chairman, currently own about 50 per cent of CES Software but cannot sell any of their shares for a year under a lock-up arrangement.

The company, which was set up in May last year and which has just two customers, is hoping to have its shares listed on the stock market by the end of November.

CES Software, which employs about 20 staff, has spent about £600,000 of its original £900,000 of funding so far. Analysts do not expect it to reach break-even until 2005, when they predict it will produce £7.7m of turnover.

Mr Abony said: "Since the formation of this business in 2002, CES has developed a robust, secure and scalable exchange betting technology that provides a marketplace and trading system through which individuals can place and lay bets with each other."

CES Software is planning to spend the money raised on general corporate purposes, sales and marketing and research and development, but is also interested in small acquisitions.