MusicMagpie valued at £208m in share placing
By Sean Farrell
Date: Friday 16 Apr 2021
(Sharecast News) - MusicMagpie is raising £15m in a share offer that will value the refurbisher of mobile phones and other gadgets at about £208m.
The company said it placed 7.77 million new shares and 49.42 million existing shares at a price of 193p each with institutional and other investors. The placing will raise gross funds of £15m for the company and £95m for selling shareholders.
MusicMagpie was founded in 2007 to refurbish and sell smartphones, tablets, consoles and other electronic products. The market is worth £9bn in the UK and US and is supported by interest in the circular economy, rising prices for new products, slowing innovation and separation of handsets from carrier contracts, the company said.
UK households have about £16.5bn of technology they no longer use and only a small percentage of items are recycled, the company said. MusicMagpie gives sellers a fixed valuation online and pays for their postage. It then refurbishes the gadget and sells it on with a 12-month guarantee.
The company's revenue has increased to about £153.4m in the year to the end of November 2020 from £115.5m two years earlier. Earnings before interest, tax, depreciation and amortisation increased to £13.9m from £2.6m in the same period.
When the shares start trading on AIM the company will have a free float of about 53%. Directors and senior managers will own 11.5% of the company with 16.1% held by NVM Private Equity and Mercia Fund Management combined.
Steve Oliver, chief executive and co-founder, said: "We are thrilled that musicMagpie's circular economy model has resonated so strongly with investors, and are delighted to have received such a high level of demand for the placing.
"Given the ongoing move to tackle the growing problem of e-waste and the fact that consumer attitudes towards buying refurbished consumer technology products are rapidly changing, we believe that there is significant potential for musicMagpie's future growth prospects."
The company has operations in Stockport, Greater Manchester, and in Atlanta, Georgia. It operates under the Decluttr brand in the US.
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