Kofax Plc's management confirmed that the board is planning for an initial public offering (IPO) in the United States at some stage in the future with plans to maintain a dual listing between the United Kingdom and the U.S.
We see this as a sensible step for the business, whose headquarters, senior management and majority of its business (53 percent of fiscal 2011 revenues in Americas) are currently U.S. based, said Graeme Clark, an analyst at Jefferies.
Clark said the board has not set a specific timescale for this process but he would expect the timing to depend on market conditions, an improved trading momentum and a genuine need for additional funding, to create enough liquidity in this second listing.
With $98 million of net cash on the balance sheet at the end of June, Clark expects management to look to accelerate the pace of acquisitions, which is likely to create this need for additional funding.
Clark expects Kofax to continue to target bolt-on acquisitions with the management open about its ambitions to acquire in two key areas, namely Business Process Management and Business Intelligence/Analytics.
Clark said both key areas are naturally complementary to the current offering and provide the ability to extend the depth of Kofax’s customer relationships.
We view Kofax's plan for a dual listing in the U.S. as a sensible one but with potential investors likely to want to see at least a year of improved trading, we expect that this will not be a short-term prospect, said Clark.
Kofax stock is currently trading down 0.91 percent at 272 pence on the London Stock Exchange at 11 am BST.