Raymarine go to market

Electronics giant head for floatation on London Stock Exchange

Above: Tony Osbaldiston and Malcolm Miller

Raymarine Group Limited, one of the world’s largest suppliers of leisure marine electronic products, has announced its intention to seek a listing on the main market of the London Stock Exchange. The intended flotation will be by way of a placing of existing ordinary shares in the Company with institutional investors. Hawkpoint is acting as Sponsor and Financial Adviser. Collins Stewart is acting as Broker.

Raymarine was formed to acquire Raytheon’s Recreational Marine Division in a management buy-out backed by HgCapital in January 2001. Since the buy-out, the Group has invested significantly in the growth and profitability of the business, with particular focus being placed on developing new products and on strengthening the Group’s sales and marketing teams. In addition, there have been a number of additions to the senior management team which now consists of Malcolm Miller (Chief Executive), Tony Osbaldiston (Finance Director), Terry Carlson (President of Americas and Head of Global Product Management) and Kieran Breheny (Design and Development Director).
In the year ended 31 December 2003 Raymarine’s turnover was approximately £94 million.

The Directors believe the Group’s key strengths, which have contributed to its success to date, are:

- Raymarine’s position as one of the world leaders in the supply of marine electronic products to the leisure boating market;
- its well-recognised brand and reputation for producing innovative and reliable products in a safety conscious environment. Leisure boaters necessarily place great reliance on the reliability of the electronic products as they ensure that boaters know where they are and what is around them, and allow communication when out on the water. The Directors believe that the requirement for a track record demonstrating reliability represents a key barrier to entry against other electronic manufacturers entering the market;
- its ability to offer a comprehensive portfolio of marine electronic products for the leisure boating market, combined with its strength in networked and integrated systems which enable different products to interface and communicate with each other. The combination of these two attributes allows boat users to have a single range of linked products from the same manufacturer providing full functionality with improved aesthetics. The Directors believe that this type of systems integration is increasingly becoming an important driver of sales growth;
- its strong customer relationships, loyal customer base and ability to sell products in Europe, North and South America and Australasia through its network of dealers, distributors and through OEM boat builders and national retailers;
- its world-wide support network and reputation for providing high-quality after-sales support. Many boaters use their boats infrequently and for short periods and therefore value the ability to have products supported and serviced quickly in virtually any port or marina they visit. Raymarine has a network of approximately 960 service dealers around the world covering most major leisure ports and marinas;
- and Raymarine’s strong, well-regarded management team with extensive experience in developing, manufacturing and marketing consumer products. Since the buy-out, the management team has been demonstrably successful in designing and launching new products and increasing the scale of the business.

The Directors anticipate that drivers of future growth in the leisure marine electronics market will include:
- advances in technology making electronic marine equipment more affordable and easier to use;
- increased speed of product innovation leading to more frequent upgrading of equipment, with customers demanding increasing functionality and ease of use;
- increasing demand from boaters for integrated and networked products which are able to communicate and interface with each other;
- and the use of existing technologies to expand the leisure marine electronics markets by adding further functionality to existing systems.

In addition, the Directors believe that the leisure marine electronics market will benefit from the anticipated growth in disposable incomes and growth in the number of increasingly wealthy, older people in the US and Europe who have the leisure time to go boating.

Raymarine is seeking Admission to:
- raise its corporate profile;
- gain an attractive acquisition currency;
- secure a more diversified shareholder base;
- enable HgCapital to realise a proportion of its investment; and
- facilitate the further incentivisation of key management and employees.

Raymarine is not raising any new money in connection with the Placing.

Malcolm Miller, Chief Executive, commented today: “Raymarine has a long history as a supplier of marine electronic products and we look forward to a listing on the London Stock Exchange as the next logical step in the company’s development. We believe that a listing will enable us to take advantage of growth opportunities in our markets.”