A British company plans to buy Cork-based data storage specialist, Raidtec, in an all-share deal valued at more than €5 million.
London-listed Plasmon has offered to buy Raidtec's entire issued share capital for €2.25 million and to repay shareholders approximately €2.86 million in loans given to the Irish company.
Plasmon will issue more than 1.5 million new shares, valued at 313.65 cents each, to Raidtec's shareholders to purchase the Irish company and to repay the loans. The share value is based on Plasmon's closing mid-market price on April 15th.
It has also applied to the UK listing authorities to issue 1.6 million new shares to raise €5 million for Raidtec's capital needs and expansion. Those shares are expected to be admitted to the London market tomorrow.
The deal is expected to be completed this week. Plasmon has already received irrevocable acceptances from Raidtec shareholders with an aggregate of more than 80 per cent of its issued share capital. In a statement, the British company pointed out that Irish law allowed it to compulsorily acquire the remaining stake in the company.
Raidtec has a number of high-profile shareholders, some of whom will suffer losses as a result of the sale. ACT Venture Capital paid the equivalent of €2.8 million for a 25 per cent stake in the company in 1996. This week's sale values that holding at just over €560,000.
In January 2001, it raised $17 million from a number of domestic and international banks, including NIB Capital, Dresdner Kleinwort and Barclays, who are listed as shareholders.
According to 2002 annual returns, the last one filed, Mr Dermot Desmond's vehicle, IIU Nominees Ltd, was the largest shareholder with two million shares. On the basis that the company had 5.5 million issued shares, the Plasmon purchase values this holding at more than €800,000.
Staff and management held over 1.1 million shares through a nominee account. That stake is now valued at around €410,000. State agency Enterprise Ireland, is listed as having 48,857 shares in Raidtec. A number of American and European institutions and individuals had small stakes of varying sizes in the company.
Raidtec develops and manufactures network and disk-based data storage systems and has originated its own technology in this field. It has been developing a product jointly with Plasmon for the last 18 months. Its chairman and chief executive, Mr Noel May, founded Raidtec in 1991 in Cork.
Six years later, the company said it was generating the equivalent of €14 million in revenues, and Mr May predicted that this would reach €127 million by 2002.
Its balance sheet shows that in the year to October 4th, 2002, shareholders' funds had dropped from $22 million to $9.7 million. Its profit and loss account was in the red to the tune of $16.8 million, compared with $721,772 the previous year.
