Blancco Technology Group: 'Very well supported' £9.8m placing
Blancco is the world’s leading developer of ‘data erasure’ software, used to protect governments and corporates from ID/data theft and cyber-crime, along with being a pioneer in smartphone diagnostics (Xcaliber).Following the 25th April trading statement, Blancco announced this morning that it had raised £9.8m (gross) in fresh equity, after placing 5.8m new shares at 169p each. We understand this top-up funding was very well received by existing investors, who were keen to support the board’s ambitious, yet realistic, expansion plans.
Such was the level of interest, that the size of the placing was more than double what had been originally envisaged 2 weeks’ ago (ie minimum of £4m), with the book building exercise concluded at no discount to yesterday’s closing price.
Importantly, by gold-plating the balance sheet the extra cash should help win further blue-ribbon contracts with large corporate and government clients worldwide, who inevitably request longer payment terms, and tend to only deal with suppliers with strong credit positions. June FY17 closing net cash is now expected to be around £4m, as opposed as to -£5.5m previously.
We make no change to our FY17/18 forecasts other than to reduce the interest charge and lift the share count accordingly (~10%, or 9.1% of the enlarged group)) – which together has nudged down the valuation to 220p per share, from 230p before.
Blancco Technology Group provides data erasure software. Co.'s segments are: Erasure, which enables customers to erase and repurpose IT devices with certified software; and Diagnostics, which provides diagnostics of smartphones and tablets, as well as new diagnostics tools. The erasure division focuses on development and delivery of solutions, includes: Blancco, a provider of data erasure software; SafeIT, which involved in cloud and networked data erasure; and Tabernus, which provides software erasure products. The diagnostics division consists of the Mobile Diagnostics business, comprising Xcaliber Technologies, a smartphone diagnostics software business and its SmartChk solution.
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