Semiconductor maker set for AIM float in boost for City

A Reading-based semiconductor firm today said it was planning a float on London’s small-cap stock exchange in a glint of hope for the City’s moribund capital markets amid an alarming slump in activity.

Sondrel, which designs and supplies semiconductors to some of the world’s biggest names in tech including Apple, Sony and Tesla, is seeking to raise £20 million to ramp up production and scale its global footprint, in a move which would value the company at about £50 million.

Graham Curren, Chief Executive Officer of Sondrel, said: “Sondrel is at the cutting edge of our industry, delivering designs at 5 nanometres and below, a level of engineering that only a handful of companies can match.”

“We are well positioned to benefit from a number of industry and geopolitical megatrends and believe we can be a true UK technology success story as a public company.”

The firm had revenues of £8.2 million in 2021 but has plans to grow to £100 million in the medium term.

The move comes despite less-than-propitious market conditions for the global semiconductor industry. This morning one of the world’s biggest chipmakers, Samsung Electronics, reported a 32% drop in profits, led by a downturn in chip demand, while last week rival chipmaker Micron Technology said it was cutting investment by 30% and warned of tougher times ahead.

The AIM market raised a paltry £3 million for fresh flotations in the last quarter, a 13-year low and a sign of a wider slowdown in the City, putting banker bonuses – and jobs – at risk.

Colin Wright, Chairman of the UHY Hacker Young Group, says that many companies have had to shelve plans to list on AIM until volatility in the stock and bond markets reduces.

Wright adds: “A period of market turmoil is a very difficult time to deliver a successful IPO. Companies that were gearing up for floats on AIM have been forced to hold off until the current volatility subsides.”

“At least two AIM IPOs that were confirmed as flotations for September have been paused. The same will have happened to plenty more floats that were further back in the pipeline.”