March 8th will be a red-letter day for Fran Rooney and his pals in Baltimore Technologies. That's the day when the FTSE international actuaries decide who will be added to the Footsie, the key index used by pension funds and tracker funds. The Footsie is a seriously exclusive club and getting on the index means that companies automatically register on fund managers' radar screens and boost demand for the shares.
At current prices, Baltimore should stroll into the FTSE as it is the 75th biggest company on the London market. The other factors taken into account are the size of the free float, not a problem; liquidity, again not a problem; and volatility, potentially a problem.
But if it satisfies the market capitalisation on March 8th, it seems likely that Baltimore will get its treasured Footsie listing and join the growing number of technology and telecom shares that make up the index to the exclusion of many "old industry" stocks that previously felt that their Footsie listing was a matter of right.
If Baltimore does join the 100 share index, it will be a source of some chagrin to the suits in AIB, CRH and Bank of Ireland, who made an almighty fuss a few years ago when the FTSE compilers excluded them even though their stock market valuation was big enough - on the basis that they were not British companies. It didn't matter at the time that the three Irish plcs were big enough to merit inclusion in the Footsie, the letter of the law meant that unless a company was registered and domiciled in the UK there was no chance.
Now, lots of people in Ireland believe Baltimore is an Irish company - after all chief executive Fran Rooney is as Irish as they come and the company has sizeable operations in Ireland. But the reality is that Baltimore is registered and domiciled in the UK and, after all, it was Zergo that took over Baltimore 18 months ago even though the merged company was quick to jettison the Zergo name and install Fran Rooney in the chief executive's office.
Baltimore has had an extraordinary run of late, but there is a feeling among some analysts that pushing the shares up to £120 is taking things too far. Sure, the hacker attacks on Yahoo! and other portals have emphasised the growing need for Internet and e-commerce security, but valuing Baltimore at £5 billion (€6.4 billion) represents an enormous leap of faith in Baltimore's future.
After all, no less an investment luminary than Dermot Desmond deemed it appropriate a few months ago to sell a couple of million Baltimore shares at around £22 sterling - one-fifth their current level. Have the prospects for Baltimore really changed that much for the better since Mr Desmond sold some of his shares?
