IPO jam

Investors continue to shun initial public offerings (IPOs) from young technology companies. Spectel, the Irish conference software developer, recently joined the growing list of technology companies forced to cancel flotations in the face of weak market interest.

Later-stage companies whose IPO plans have been frustrated by sour market conditions are asking private equity investors to continue funding the business. Contact centre software vendor Altitude Software turned to new and existing investors for a fifth round of financing worth €14 million. The new and lead investor, e-Millenium 1, joins Intel Capital, Insight Venture Partners and Nesbic as shareholders.

The Portuguese company called off its scheduled IPO on the Amsterdam branch of Euronext in November 2000, putting to an end its dream of raising €150 million from the float. CEO Carlos Quintas has since said that a float is ‘not something we need to do,’ pointing to the $70 million (€76m) in venture capital (VC) the company has raised since 1995. The latest tranche of €15 million will, nonetheless, go some way towards financing Altitude’s long-term expansion plans.

Sefas Innovation, a French developer of software for content customisation and document production applications, raised €2.3 million in its fourth round of funding. This brings the total amount raised from French investors Sofinnova, SPEF, AGF and the Banque du Louvre, to €14.3 million. The company, founded in the early 1990s, plans to roll out a new software line that will extend the functionality of its flagship Open Print product family.

Amid a tough telecommunications buying market, Kreatel Communications convinced its investors — investment bank ABN Amro, the Swedish national pension fund AP-Fonden and VCs Bure Equity and Innovationskapital — to take part in a €3.5 million financing round. Kreatel develops service gateways for telecoms operators. The company, spun off from the Linkoping University of Technology in 1996, plans to use the money to develop and market its broadband offering.

IXEurope was forced to be more creative to secure financing. The data centre and hosting company, which raised over €100 million in three separate rounds between 1999 and 2001, turned to German power group RWE. The two arranged asset-based financing worth €7.3 million and a management support contract for IXEurope’s Dusseldorf site. IXEurope, which has eight co-location facilities across Europe, called off its scheduled float in December 2000 as the IPO window slammed shut to aspiring technology companies.

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Deals announced during April/May 2002
Company   What it does   Country   Amount in € (round)   Lead investor  
AEP Encryption processing Ireland 14.5m B-Business Partners
Altitude Software Contact centre s/w Portugal 14.0m (5th) E-millennium 1
Am-Beo Revenue chain mgmt s/w Ireland 10.0m (2nd) Advent Venture Partners
Automsoft Database s/w Ireland 6.0m (2nd) IDG Ventures Europe
CDB Technology EAI s/w France 1.5m Thales Corporate Ventures
Cyantel Location-based svcs Ireland 1.0m (2nd) Enterprise Ireland
Esual Software App development tools France 8.0m (3rd) B-Business Partners
IXEurope Co-location svcs UK 7.3m RWE
Kreatel Communications Platform for cmmctn svcs Sweden 3.5m Bure Equity
Neolane CRM s/w France 2.0m (1st) Auriga Partners
Open Business Exchange E-invoice delivery sys UK 8.7m (2nd) Lynx New Media
Plastic Logic Plastic electronics UK 10.2m (1st) PolyTechnos Venture Partners
Respond Cust feedback s/w UK 1.7m (3rd) 3i
Sefas Innovation Document production s/w France 2.3m (4th) Sofinnova Partners
SerCoNet Wireless networking tech Israel 7.7m (3rd) Platinum Venture Capital
TeraChip Fabless semiconductors Israel 12.2m Accel Partners
TiFiC Web-based support sys Sweden 812,575 Telia Business Innovation
Waterford Technologies Email mgmt system Ireland n/a Enterprise Ireland
Data from Infoconomist’s daily Deal Watch All currencies converted to Euros at current exchange rates.

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Ben Rossi

Ben was Vitesse Media's editorial director, leading content creation and editorial strategy across all Vitesse products, including its market-leading B2B and consumer magazines, websites, research and...

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