Red-M Reneges on IPO
In April the vendor, previously known as Red-M Communications Ltd., made a surprise move to seek a listing on the Alternative Investment Market (AIM) of the London Stock Exchange. At the time, the company was believed to be valued at £20 million to £25 million (US$35-$44 million), and was expected to issue shares worth between £10 million and £15 million ($18-$26 million). (See Red-M Preps IPO.)
According to a company statement, Red-M has “decided to postpone” the flotation, blaming the move on “a fall of 18 percent in the overall AIM index at the time.”
"As with all these things, you are looking to raise money at a good price, and we weren't going to get the price we wanted, so we pulled the float," says Red-M's chief marketing officer, Andrew Barker. "I would expect to look at the market again in the future."
In addition, the vendor’s management team has also been overhauled. CEO Karl Feilder has been replaced by David Richmond, founder and head man of database software player Striva, which was sold to Informatica Corp. in 2003. Simon Poulton, Red-M’s CFO, and Geoff Bristow, its non-executive director, have also “resigned” their positions. Both Bristow and Poulton had joined the company’s board in preparation for the planned flotation.
This latest move is not the vendor’s first management cull. Founded in 1999, Red-M purged its entire management team in the second half of 2002 following initial attempts to break into the 802.11 security space (see Red-M or Dead-M?).
Although the company is now an established player in the wireless intrusion detection system sector, Red-M has never publicly disclosed its revenue figures or revealed levels of investment from VC backers Amadeus Capital Partners Ltd. and Apax Partners.
Barker says the company now plans to raise new funds "through private equity financing."
— Justin Springham, Senior Editor, Europe, Unstrung