Monday, August 21, 2023

News: Rotherham business joins stock exchange, raises £6m


Innovative Rotherham firm, Tan Delta Systems, is toasting a successful launch on to the stock exchange which has raised approximately £6m to be used for further expansion.

Based at Dinnington, Tan Delta provides equipment monitoring technologies and solutions that use real time oil analysis to enable material reductions in maintenance costs, improve reliability and reduce carbon footprint. Tan Delta currently supplies a growing customer base of blue-chip multinationals and equipment operators.

With Zeus Capital acting as Nominated Adviser and Sole Broker, an Initial Public Offering (IPO) and admission to AIM, raised £6m through the sale of shares, achieving a market capitalisation of £19m. Zeus said it was one of the largest AIM IPOs in 2023 to date.

The deal represents the next phase of Tan Delta’s growth strategy as a market leading, real-time equipment monitoring and data analytics business, with proceeds from the primary raise supporting the Company’s growth and expansion plans.

Chris Greenwood, CEO of Tan Delta, said: "An incredibly proud moment for me, not only in achieving a successful flotation but having the exciting opportunity to now drive the business through its next phase of accelerated growth. None of this would have been possible without the hard work and dedication from all of the Tan Delta team and the continuing support given to us by our early investors.

"Innovation continues to be alive and kicking in the UK and I hope that we can be seen as an example to budding entrepreneurs as to what can be achieved. A huge thank you to Zeus for their efforts in securing a great deal for the business and for the new investors, without their relentless efforts we would not have successfully navigated the whole IPO process."

Tan Delta was co-founded in 2007 by Greenwood to develop the concept of real time oil condition analysis and to provide equipment operators with greater insight on the health and status of their equipment, thus allowing more efficient equipment operation.

Operators in a variety of industries, including power generation, mining, oil/gas and shipping, can reduce oil consumption by ensuring oil is not changed before it has reached the end of its life, and reduce breakdowns and associated costs by detecting issues before damage or failure occurs.

Following a period of R&D and trials, in 2020 the company’s first commercial sensor (OQSx-G2) entered volume production. Production is fully outsourced to a specialist contract manufacturer.

Admission documents show that Tan Delta has an initial foothold in the $200 billion global sensor market with an innovative and differentiated monitoring solution based on real time oil analysis and analytics, adding: "Despite limited sales and marketing to date, the company has successfully sold its products and services to a range of blue-chip customers including Shell, Aggreko and Schlumberger."

Tan Delta has generated positive profit after tax in each of the last three financial years, despite the challenges of COVID-19 and a global semi-conducter shortage. Turnover for the 2022 financial year was £1.575m.

Proceeds of the placing will be used for sales and marketing, product development and general working capital purposes.

Having primarily targeted large commercial and industrial equipment market segments, a new sensor product (G2-IM), currently at the concept stage but based upon the same core technology, will be developed which will be suitable for smaller scale, high volume applications in the light commercial, industrial and automotive segments.

The admission document adds: "The net proceeds of the Placing of New Shares will enable Tan Delta to significantly expand its sales and marketing to meet the support and expansion expectations of current customers as well as to attract new customers. Furthermore, it will enable the Company to increase its production capacity and accelerate new product and technology development."

Tan Delta Systems website

Images: Zeus Capital


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