News

WANdisco placing is five times oversubscribed

5th December 2017

Software firm and company of Connect Yorkshire EIR David Richards, WANdisco has raised £16m through an equity placing and said shareholders including CEO David Richards are to sell shares worth nearly £6m.


The placing was significantly oversubscribed with those close to the transaction suggesting it was five times covered, with an order book in excess of £37m.


Mr Richards, who is a co-founder of WANdisco and also interim chairman, is selling 500,000 shares to raise £2.75m and co-founder Yeturu Aahlad, who is the firm’s chief scientist, is selling 345,000 shares to raise £1.9m.


Mr Richards has donated £550,000 to the David and Jane Richards Family Foundation, a charity that improves the lives of children through hands on programs and targeted assistance.


Sheffield-based WANdisco said the proceeds from the fundraising will be used to support further revenue growth and establish new strategic partnerships.


The equity placing was double the size of the original plan after demand exceeded the original minimum target of £7.5m.


The placing shares represent 7.8 per cent of the company’s current issued ordinary share capital.


The shareholders are selling 2.8 per cent of the company’s current issued share capital.


Mr Richards said: “Over the last 18 months, we have seen a step change across our cloud and big data markets, resulting in significant traction for our core Fusion technology.”This fundraising will accelerate WANdisco’s ability to capitalise on this sizeable opportunity, enabling our teams to both deepen and broaden our strategic partnerships in order to optimise our routes to market.”


The group has been busy over the past three months and has signed another major OEM deal with Dell/EMC and extended strategic partnerships with Microsoft and Amazon.


“In addition, we have on-going interest from several new strategic partners. This is happening at a much faster pace than we anticipated,” said Mr Richards.


“We now have an opportunity to invest in multiple channels to market. The success of the IBM OEM partnership has demonstrated that we can significantly increase revenues and extend our reach into large enterprise customers.”


The firm said it is seeing strong organic revenue growth underpinned by its patented WANdisco Fusion data replication technology. The company plans to use proceeds from the placing to capitalise on this momentum and to accelerate its growth ambitions.


WANdisco said Fusion enables the replication of continuously changing data to the cloud and on-premises with guaranteed consistency, no downtime and no business disruption. With firms increasingly relying on the cloud and large scale data, it said there is growing demand for big data replication solutions, with existing data replication solutions creating increasingly unacceptable outage times as the volume of data increases.


The company believes there is a significant growth opportunity for Fusion in the cloud and big data markets, as an unrivalled solution based upon unique intellectual property, which is designed to guarantee zero downtime and minimal disruption to clients’ business operations.


The firm said it is critical to deepen existing relationships and enter into new ones in order to accelerate growth.


The proceeds will be used to invest in the company’s strategic partner sales channel, by the hiring of additional channel managers to increase its partners’ focus on WANdisco products and to expand existing relationships.


WANdisco said additional engineering staff will be hired to increase development capacity and testing, allowing for parallel efforts with multiple partners instead of the slower serial approach it currently follows.


WANdisco currently has two OEM relationships, one with IBM and another recently signed agreement with Dell/EMC’s Virtustream.


The company also has several partnerships with leading cloud technology companies, including Amazon Web Services, Cisco, Google Cloud, Hewlett Packard Enterprise, Microsoft Azure and Oracle to resell its patented technology.


 In addition, the proceeds will strengthen the company’s balance sheet to give confidence to new strategic partners and customers.


Speaking about current trading, the board said it is confident that the company is on track to achieve market expectations.



Artice via yorkshirepost.co.uk