Software firm set for pounds 60m float

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The Independent Online
JBA International, a computer services company specialising in software for IBM machines, is to join the rapidly expanding ranks of listed software firms. It hopes to raise pounds 10m later this year in a flotation likely to value it at about pounds 60m.

JBA sells programs for applications ranging from payroll to production scheduling, running on IBM's mid-range AS/400 computers, launched six years ago.

Industry estimates suggest that 500,000 AS/400s could be installed worldwide by the end of 1997, up from 250,000 in 1993. The growth sprouts from the trend away from big mainframes towards smaller computers that can serve a large number of independent workstations.

JBA was founded in 1981 by two former IBM employees. It is one of the computer giant's biggest software associates - and the leader in Europe - for the mid-range computers.

Turnover rose by a third to pounds 74.5m in 1993, with pre-tax profits up 31 per cent at pounds 4.6m. About three-fifths of sales were overseas, mainly in North America. The JBA group has subsidiaries in 11 countries and a network of agents elsewhere.

The company said the share of overseas sales in turnover was likely to increase. It recently opened a new office near Heathrow airport to administer its growing international business.

The group, based in Birmingham, also includes a training subsidiary and a computer supplies company specialising in networking products.

David Williams, finance director, said JBA spent pounds 10.5m on research and development last year. It is seeking new equity to finish development of open systems versions of its software, with the first launch due in December. These would run on a wider variety of computers, such as Hewlett-Packard and DEC machines.

JBA also plans to increase spending on marketing. It expects a listing to help extend sales beyond its traditional medium-sized business market to bigger companies - although existing customers include American Airlines, Sega and Reebok.

One analyst said: 'JBA has a good reputation, but the computer services sector is becoming quite crowded. Other companies are still thinking about coming to the stock market.'

JBA's biggest institutional shareholders are Lloyds Development Capital and CinVen, which invested in the group in 1988. The management will retain a significant stake on flotation.