BCO to seek stock market listings

BCO Technologies, a Belfast manufacturer of a new products for integrated circuits, plans to seek a share quotation on Dublin's Developing Companies Market (DCM) and London's Alternative Investment Market (AIM). The company will be capitalised at around £25 million sterling and is being grant-aided by the Industrial Development Board (IDB) in Belfast. ACT, the Dublin-based venture capital group, has a 25 per cent stake.

BCO plans to establish a bonded wafer manufacturing plant at Glen Road, Belfast, which will employ 200 people by December 2000. It now employs 78 people. Based in Belfast, BCO will be the first Northern Ireland company to join either the DCM or AIM. Founded in 1991, the company plans to raise around £7.5 million in new equity, all of which will be used for expansion.

It was set up to exploit the commercial potential of a new product, called BCO Substate, which the company says replaces the conventional unprocessed starting silicon wafer used in the fabrication of analogue integrated circuits (ICs). These ICs are used to link digital computers to the "real world" and are used in a number of products, including telephone systems, modems, mobile phones, faxes, disc drives, automotive products, instrumentation and white consumer goods.

The products, according to BCO, offers manufacturers of analogue ICs fabrication facility at no material additional capital cost and can improve performance of the finished analogue IC. The company commenced production in December 1996 for US electronic companies CP Clare, International Rectifiers and Elantec. In addition, BCO says it is at various stages of product development for 15 other companies including Siemens, Hewlett Packard, National Semiconductor, Ericsson and Daimler Benz.

BCO has, up to now, been financed by venture capital to the tune of £5.7 million. One of the earliest investors in BCO was Enterprise Equity, a venture capital group owned by the International Fund for Ireland. Enterprise now owns 22 per cent. The other venture capitalists are 3i, which owns 30 per cent, and ACT, with 25 per cent. Two of the founders, Dr Scott Blackstone, chief executive, and Mr James Corkery, marketing director, will have between 6 per cent and 8 per cent of the equity after the flotation. While they will show a large paper profit from the flotation, they will be unable to sell any of their shares for a two year period.

The chairman, Mr Dermott Simpson, told The Irish Times the company would have gone for a full listing but did not have the required three years trading. It may seek a quotation on the US NASDAQ in time.

BCO is generating an annual turnover of some £1 million, according to Mr Simpson. It will lose money right up to 1998 but plans to go into profit early in 1999. Dr Blackstone and Mr Corkery chose Belfast because of Queens University which "is the core of excellence in BCO's core technology and because of the availability of grant and development funding", BCO says.