Software coding training business looks to raise £2.1m

Northcoders, a provider of training programmes for software coding, aims to raise about £2.1m before expenses via a placing of around 694,444 new ordinary shares at 300 pence per share.

The placing price is a discount of about 4.8% to the closing price of 315 pence per ordinary share on 18 November 2022.

Net proceeds will be used to further accelerate the Leeds and Manchester-based company’s growth strategy by introducing four new technology training courses across the following disciplines: Cyber Security; Platform Engineering; Quality Assurance; and Agile Project & Product Management.

These technical disciplines will sit alongside the company’s current offerings of Software Development and Data Engineering, resulting in the potential growth of technology bootcamp student numbers alongside a broader service offering for corporate clients engaging with the Northcoders Business Solutions division.

An investment of £0.5m will also be made into NCore, the Group’s core technical delivery platform, to further improve cost of sale efficiencies.

Chris Hill, CEO of Northcoders Group, said: “Northcoders has delivered significant financial and operational progress since our IPO.

“The digital skills gap and a shortage of tech talent in the UK continues to grow, which only serves to increase demand for our services.

“We are using our insights in the EdTech market to strategically expand our service offering, and believe investment in new technical discipline areas, as well as development of Ncore, our core technical delivery platform, will support our mission to provide the UK with the technologists it needs while creating life-changing opportunities for individuals.”

In the event of the placing being oversubscribed, David Llewellyn, a substantial shareholder, Chris Hill and Amul Batra (COO)* have each indicated they would be prepared to sell some of their existing ordinary shares subject to admission occurring.

In addition, certain option holders have indicated they would be prepared to sell up to 50,000 new ordinary shares which would be issued pursuant to the exercise of share options.

WH Ireland and Peterhouse are acting as joint bookrunners in connection with the placing. The placing shares are being offered by way of an accelerated bookbuild, which is expected to close later today.

On close, the placing was significantly oversubscribed, so, to satisfy some of this investor demand a secondary placing, subject to admission, has been arranged where executive directors Chris Hill and Amul Batra have agreed to sell 19,588 and 19,587 existing ordinary shares, respectively, at the placing price. David Llewellyn, a substantial shareholder, has agreed to sell 13,333 existing ordinary shares at the placing price, and two employees have agreed to exercise share options and sell the resulting 50,000 new ordinary shares at the placing price.

Following his sale, Chris Hill will hold 1,504,080 ordinary shares, representing approximately 19.6% of the enlarged share capital following admission.

Following his sale, Amul Batra will hold 949,413 ordinary shares, representing approximately 12.4% of the enlarged share capital following admission.

Amati Global Investors Limited, a substantial shareholder in the company, has subscribed for 106,679 placing shares. This subscription constitutes a related party transaction under the AIM Rules as Amati currently holds approximately 14.33% of the existing ordinary shares and is, therefore, a “substantial shareholder” under the AIM Rules.

Angela Williams, chairman of Northcoders Group, said: “We are extremely pleased to have raised approximately £2.1m via an oversubscribed placing today, the proceeds of which will allow us to further accelerate our growth strategy as Northcoders continues to build and expand.

“Following our successful IPO in July 2021, we have seen significant growth in demand for our technology training across the UK and this placing will further accelerate our growth, allowing us to add four new training courses which will not only increase the Technology bootcamp numbers but also provide a broader service offering to our growing list of corporate clients. We are also excited to invest further in our key Ncore technical delivery platform, which will improve cost of sale efficiencies.”

*Batra will be speaking at the Disruptors North 2022 technology and innovation conference on Thursday 24 November. Click here for more details.