OpSec PIPE takes AIM for Dickinson Dees - 05 Feb 2010
The transaction is only the North’s second PIPE deal - where a private equity investor takes a significant minority shareholding in a public company whose shares are already traded on the public markets – and Dickinson Dees has advised on them both.
Under the deal, which is expected to complete in March, OpSec has immediately issued a 5% shareholding to Investcorp which will, on completion, increase its shareholding to 29% and its total investment in Opsec shares to £7.6 million. In addition, on completion Investcorp will advance a $13 million loan to OpSec. Unusually, the fundraising has been completed at a significant premium to OpSec’s recent share price, with the new shares to be issued at more than 150% of the company’s share price last week.
OpSec will use the fresh funding to repay existing borrowings and to fund further development of its business through both organic growth and acquisitions. The deal requires approval by OpSec’s shareholders later this month, but the board and other shareholders holding 25% of its shares have already indicated that they intend to vote in favour of the required shareholder resolution.
Investcorp Technology Partners, OpSec’s new funding partner, is the technology private equity arm of the Investcorp Group whose ultimate parent company, Investcorp Bank B.S.C., is quoted on the Bahrain Stock Exchange. Investcorp Technology Partners manages private equity funds with commitments exceeding $1 billion and invests in technology-driven businesses in Europe and North America from offices in London and New York. Investcorp Group currently manages $12 billion of assets.
David Mahony, OpSec’s Chairman, said:
“Opsec sees significant growth, investment and acquisition opportunities which we believe will enhance shareholder value. The fundraising with Investcorp Technology Partners will enable Opsec to take advantage of these opportunities as they arise.”
A team of a dozen corporate and finance lawyers from Dickinson Dees advised OpSec on the deal, led by corporate partner Jamie Pass. Commenting on the transaction, he said:
“This is a great deal for OpSec and will give the company new firepower to fund its future development. It’s been a fascinating challenge for us, legally and logistically, requiring us to combine the requirements of a private equity structure within the rules which all publicly quoted companies have to observe, and to communicate effectively with clients and funders based in the States.”
Mike Angus, OpSec’s Finance Director, commented:
“This deal gives OpSec the opportunity to grow and transform our business. It wouldn’t have been possible without the fantastic support and resources we received from Dickinson Dees throughout – they met every challenge we threw at them and their experience in handling international transactions was obvious.”
The OpSec deal is the latest in a string of recent fundraisings and transactions for AIM Market companies handled by Dickinson Dees. These have included advising Newcastle based e-Therapeutics plc on fundraising with Octopus and Gartmore which raised £4.5 million, London based NetPlay TV plc on its strategic partnership and £12.8 million fundraising with Playtech, Worksop based Kiotech International plc on its acquisition of the Optivite Group and associated £4.7 million AIM fundraising and London-based ECO Animal Health Group plc on its acquisition of EcoPharma Inc in Japan.