Auction Technology IPO: what you need to know before it floats

Fans of BBC’s Bargain Hunt auction programme will be interested to hear about this technology IPO.

The latest IPO in London’s flourishing pipeline of new issues will have a valuation of £600 million when shares in Auction Technology Group open for bidding on Tuesday.

The online auction specialist, whose Saleroom platform is often seen on BBC’s Bargain Hunt, has set an opening price of 600p a share ahead of conditional dealings set to begin on Tuesday 23 February.

Its debut comes hot on the heels of bootmaker Dr. Martens (LSE:DOCS) and online greetings card business Moonpig (LSE:MOON), both of whom have enjoyed positive starts to life on the London Stock Exchange. Cornish Metals (LSE:CUSN) and medical cannabis firm Kanabo (LSE:KNB) joined yesterday, while Virgin Wines disclosed yesterday its intention to trade on AIM in a potential £100 million listing.

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The rush to capitalise on favourable market conditions includes an encouraging number of technology-focused stocks, with fast-food delivery platform Deliveroo reported by Sky News to have pencilled in 8 March for the release of its intention to float document.

Cyber security firm Darktrace and business review site Trustpilot are also believed to be close to tapping potential investors. This activity represents a turnaround in fortunes for the London market, after a barren few years when newcomers were put off by Brexit uncertainty and the Covid-19 pandemic.

Strong appetite among investors has been demonstrated by the oversubscribed offering of Dr Martens, which is now trading at 497.4p after being priced at 370p a share in late January. Moonpig kicked off at 350p but is now 446.8p, while AIM-traded consumer goods business Supreme (LSE:SUP) has risen to 181.5p from the 134p at which it placed shares with institutions.

Cornerstone investors including Merian Global Investors and Jupiter Asset Management have already committed to buy £125 million of shares in the Auction Technology Group offer.

The company, whose involvement in the auction industry dates back to 1971 when it published the first edition of Antiques Trade Gazette, plans to raise £247.4 million from the offer of new shares. More than half of this will be used to repay preference shareholders, with a further £115 million going towards eliminating debt.

Auction's other platforms include Proxibid for the North American industrial and commercial marketplace and BidSpotter, which operates on both sides of the Atlantic.

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Chief executive John-Paul Savant said the quality of investor support so far highlighted the potential of the group, which was acquired last year by private equity firm TA Associates.

He added: “With a 50-year track record, proven commercial model and leading positions in a market supported by significant structural growth trends, we believe that ATG will thrive as a listed business.”

Unconditional dealings in the shares under the ATG ticker begin on Friday next week.