Enterprise Ireland-backed Zutec software firm nears Nordic flotation

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Irish software firm Zutec Holdings, which specialises in providing solutions for the global construction industry, is in the final stages of a 57.5 million Swedish krona (€5.7 million) share sale before becoming the first Irish company to list in Sweden this month.

The Enterprise Ireland-backed firm decided against listing in Dublin because of the small size of its revenues, and the UK, partly due to Brexit, in favour of the Nasdaq First North market in Stockholm, according to its chief executive, Brendan O’Riordan.

“We looked at different markets… but the Nasdaq brand won out – particularly as we see North America as a big target market,” said Mr O’Riordan.

Founded in 1999 by its current non-executive chairman, Brian McGuire, Zutec had a turnover of €2.44 million for 12 months to the end of last June, up from €1.56 million for the previous year, according to the flotation prospectus.

Zayed University
The 300-plus projects it has been involved in include the Wembley Stadium and the Shard tower in London, Zayed University in the United Arab Emirates and the new port and airport in Doha, Qatar.

The company’s software allows its users to manage, store and share data, manage processes and workflows which serves to cut costs, errors and avoid delays on projects which are rampant in the construction industry, the prospectus said.

Mr O’Riordan said about 70 per cent of the proceeds from the initial public offering will be used for sales and marketing, particularly as the company aims to expand in Scandinavia and North America, with the remaining 30 per cent earmarked for research and development.

If all the shares on offer in the IPO – including an amount set aside for oversubscriptions – are taken up, Mr McGuire’s stake will fall from 48.1 per cent to 32.5 per cent, while Enterprise Ireland’s holding will dip from 4.4 per cent to 2.9 per cent. The company would have a starting market value of the equivalent of €17.8 million.

Mr O’Riordan said that the company avoided seeking venture capital investment in favour of an IPO, as the former may have resulted in a loss of control, a lower valuation being set for the company and less “liquidity” for investors.

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