The shares of recruitment company, Marlborough International, are set to begin trading in London and Dublin by the end of the month, having been fully placed with private investors and institutions. The 10.4 million shares have been placed at 96p each and will begin trading on Dublin's Development Capital Market and on the Alternative Investment Market in London on October 29th, according to group managing director, Mr David McKenna.
The placing was four times oversubscribed with leading British and Irish institutions among those taking up the new shares. Mr McKenna said yesterday that 39 institutions had subscribed for the shares, including Standard Life, Scottish Provident, AIB, Bank of Ireland and Irish Life. The shareholdings are well spread, he added, with no institution taking up more than 3 per cent. Some 350,000 shares were purchased by Marlborough International staff, while the remainder of the shares were taken up by around 100 private investors, he said. The placing price gives Marlborough a market capitalisation of £25.4 million and raises £6 million for the company. Mr McKenna, who sold over four million of his shares, will receive just under £4 million before expenses following the flotation.
Announcing the placing yesterday, he said the company was "exceptionally pleased" with the interest shown by institutions and private investors in Ireland and the UK.
Marlborough International operates two subsidiaries, the Marlborough Group and Professional Placement. It intends to use the capital raised to fund acquisitions and to grow its existing Irish recruitment businesses, which already account for a substantial share of the Republic's total recruitment and out-placement sector.
Mr McKenna said Marlborough's primary objective is now to expand into the UK and is planning to spend up to £9 million on acquisitions over the next 12 months. "We have already closely looked at one acquisition and would hope to be able to add up to three acquisitions to the group ahead of seeking a full listing on the Irish and London stock exchanges." The funds were raised at a cost of £560,000. Of this, the company will bear £460,000 while Mr McKenna will pay the remaining £100,000 in relation to the placing of his shares.
The flotation unlocks what has turned out to be a highly lucrative investment for Mr McKenna. He initially bought into the company in 1992 for £6000. The company has since delivered a profitable return and in the six months to the end of February last reported pre-tax profits of £805,000.
Mr McKenna along with two other directors still retains a 60 per cent stake in the company. Marlborough finance director, Mr John Nolan has a 5 per cent stake and group manager and technical division manager, Mr Adrian McGennis also holds 5 per cent. Mr McKenna remains the major shareholder with a stake worth up to £10 million at the current flotation price.
Marlborough is the first Irish recruitment company to seek a listing on the Dublin market but will join up to three others on the London AIM. It employs 105 people in Ireland. The group places about 2,000 people a year in companies in the Republic.
