Wolfson aims to lead pack with new HQ

Published on Sunday 28 September 2003 01:00

WOLFSON Microelectronics, the audio chip developer, is moving to new offices in Edinburgh ahead of its flotation next month.

The move will be announced tomorrow when the indicative price range of its forthcoming share issue will be revealed, along with another non-executive director. The share issue is expected to value the company at about 200m.

The company’s new headquarters in Edinburgh’s Westfield Road, between Gorgie and Murrayfield, will provide 48,000 sq ft of office, laboratory and engineering space.

The flagship block, visible from major rail and road routes, is about twice the size of Wolfson’s cramped home in the Newington area of the capital.

Julian Hayes, the company’s marketing director, said: "It will allow us to expand our engineering work, and there are not many buildings where you can do that close to Edinburgh city centre. We have a dynamic young workforce and they want to be near the city."

Wolfson currently employs about 120 staff working on computer chips which are used in mobile phones, DVD players and Microsoft’s Xbox games console.

Hayes said the new site would have space for up to 300 staff. Cash to double the company’s workforce will come from increasing sales and the flotation, scheduled for October. "This is clearly part of our ambition to keep expanding," Hayes said.

He added that the decision to expand in Edinburgh underlined the company’s commitment to Scotland. "We are a Scottish company and part of the reason for our success is that we have a really good group of people, many of whom come out of the institutions here."

Wolfson is this weekend in talks to sign up an additional non-executive director and the company is expected to begin touring financial institutions, including those in Edinburgh and Glasgow.

Sources close to the company said pre-marketing of new shares had gone well, although it was still early days to gauge the appetite for investment among fund managers.

Citigroup is sole bookrunner and sponsor for the offer. Citigroup and Cazenove have been appointed joint lead managers.

Wolfson recently set up a software development team at its Edinburgh headquarters. The team, headed by Peter Frith, vice-president of new product definition, will work with electronics companies to speed up the development of new products.

In the six months to June 30, Wolfson made a pre-tax profit of 2.5m, up 173% on the same period the year before. Turnover rose by 124% to 17.6m.

Wolfson, which spun out of Edinburgh University in 1984, is expected to raise more than 50m for its development plans when it floats next month.

Scottish Equity Partners, the venture capital house which invested in Wolfson, will be a major beneficiary of the float. Co-founders David Milne and Jim Reid will have stakes worth 9m and 5m respectively if the company reaches its expected valuation.