Hi-tech leader's fall a Psion of the times

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The Independent Online

Psion, once the flag-bearer of Britain's booming technology market, will this week announce a hefty write-down in one of its most important businesses.

The wireless gadget company is expected to reveal on Thursday a fall of £100m in the value of its core Teklogix wireless software business.

Psion bought the Canadian company in July 2000 for £242m and now lists Teklogix as worth £204m in its books. But analysts believe the severe downturn in the technology market, combined with the poor economic conditions in North America, mean Teklo- gix's value has since halved.

Psion is also expected to make write-downs to its minority stakes in technology companies Radioscape, Widcomm, SyVoz and QuickNet.

Psion is one of the biggest casualties of the technology bubble. Its shares peaked at £14.54 in March 2000, valuing the company at £5.6bn and putting it in the FTSE 100. Today its shares are worth 88.75p, giving it a market capitalisation of £368m.

Psion's year-end results are expected to show the company has generated around £180m in revenues but made an operating loss of £10m. But, unlike many of its peers in the technology sector, Psion has no debt, and at the end of November the company had £15m cash on its balance sheet. Psion is also the majority shareholder in Symbian, the mobile phone software joint venture with Ericsson, Sony, Nokia and Motorola. Holding a 28.1 per cent stake, Psion has been criticised by the City for being relatively tight-lipped about its plans for the business.

In 2000, analysts valued Symbian as high as £5bn, and there was talk of the business floating this year. But Psion chief executive David Levin is this week is expected to say that plans to sell shares in the business will not be contemplated until GPRS and third- generation mobile phones have achieved mass-market status.

Last month Nokia said it hoped that by 2004 about half of all third-generation phones would be based on the Symbian operating system. At the same time Symbian raised £21m from its shareholders, to compensate for the delay in the rollout of next-generation mobile phones.

Psion's future now depends on Symbian and Teklogix as the company moves away from hardware and concentrates on mobile software.

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