Psion to float Symbian in push to establish wireless standard

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Psion, the hand-held computer maker, is to float its Symbian operating system company next year in a move that could value the fledgling enterprise at around £5bn.

Psion, the hand-held computer maker, is to float its Symbian operating system company next year in a move that could value the fledgling enterprise at around £5bn.

Symbian, controlled by Psion, Nokia, Ericsson, Motorola and Matsushita, is developing an operating system that will enable wireless devices such as handheld computers and mobile phones to link to the internet, send e-mails and run new features such as full motion video.

Though prototype hardware containing the Symbian system is only just starting to become available, Psion hopes its software will establish itself as the industry standard for mobile devices in the same way as Microsoft's software has become the standard in personal computers.

But David Levin, Psion's chief executive, said he wanted Symbian to make further progress before going ahead with a listing. "We don't want to float a concept company. We want it to have real revenues," he said. "When we can see that happening the company is probably in the right position."

He added that much would depend on the stock market's appetite for a float of this size as well as volume sales of Symbian-enabled products.

Symbian, which was formed in 1998, will list on the London market and on Nasdaq in New York. The company will be based in London. Psion said advisers had not yet been appointed as the float is not expected to take place until mid-2001 at the earliest. It is thought that 10-20 per cent of the company will be listed.

Symbian recorded increased losses of £4.7m in the six months to June due largely to the workforce increasing to 520, excluding contractors. Analysts forecast it to break even in 2002-03. Psion is the company's largest shareholder with a stake of 28 per cent.

The company earns its revenues by charging a licence fee of $5-$10 for every piece of hardware, such as a phone or a Psion organiser, that includes the Symbian software. Sony signed up to license Symbian's software in April, though it has not become a shareholder.

Psion said yesterday that the final release of its key Symbian EPOC system would be made in its third quarter, ending in September. Product shipments are expected to start in the first quarter of next year.

The decision to float Symbian accompanied Psion's half-year results which showed profits rose to £3m compared with £100,000 the previous year. Sales rose from £64.2m to £94.3m.

Sales of Psion computers doubled to £48.8m, driven by strong sales of its Revo and Series 5mx models. "These results demonstrate the core Psion business is in great shape and the company should, over the coming few years, deliver strong growth," said Nomura analyst Nainesh Bapna.

He said Symbian was worth 450p to 550p per Psion share. Psion shares rose 10p to 675p.

Psion said its £242m takeover of Teklogix, the Canadian wireless network and software developer, is on track for completion in the third quarter. It also said that products using the Bluetooth, short-wave wireless technology, are set to be launched early next year with volume shipments expected in the second half of 2001.