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Strip Tinning float on AIM

February 2022

 

Strip Tinning, founded in 1957 and headquartered in Arden Business Park, Birmingham, is an established supplier of specialist connectors to the automotive sector.

Strip Tinning manufactures specialist flexible electrical connectors related primarily to heating and antennae systems embedded within automotive glazing and to the connection of the cells within electric vehicle (EV) battery packs, increasingly using flexible and lightweight printed circuit technology that also has growing application elsewhere within vehicles.

The Group consists of two business lines; Glazing and EV. Over 90 per cent. of the Group’s historical sales have been related to Glazing systems by way of (i) Busbars for in-screen heating; (ii) Connectors for heating; and antennae and (iii) supplies of tungsten. These Glazing products are used on vehicles of various type across the automotive industry, from cars to trucks and from the smallest to the most exclusive, and independent of the chosen powertrain.

The transition of the automotive sector towards EV is providing additional significant new growth opportunities for the Group’s electrical connectivity solutions with battery-related products representing the principal opportunity. In 2019, the Group launched ‘ST Flex’ to focus on these new opportunities, drawing on its experience with flexible printed circuit connectors to provide connectivity between vehicle batteries and multiple cells and other lightweight, easy to package connector solutions.

 

Admission to Trading on AIM

On 16th February 2022, admission and dealings on AIM commenced by way of a Placing of 15,137,369 Ordinary Shares of 1 pence each at 185 pence per share.

 

Reasons for Admission and use of proceeds

The Directors believe that Admission will assist the Group in its development for the following reasons:

  • raising its profile in the sector in which it operates;
  • providing investment to accelerate the growth of the business and to underpin its current early mover advantage;
  • increasing access to capital as and when further finance is required to expand the business of the Group;
  • providing opportunities for the Board to use its Ordinary Shares as consideration in connection with any relevant acquisition opportunities; and
  • providing a market on which its Ordinary Shares can be traded, which will give increased liquidity and a market valuation for the Company’s equity which, in conjunction with the Share Schemes, will assist the Group in being better positioned to attract, retain and incentivise high calibre employees

The net proceeds of the Placing receivable by the Company are approximately £6.8 million and are expected to be applied principally as follows:

  • capital spend on machinery to increase the Company’s production capacity in line with its sales growth;
  • capital spend on machinery to further automate key production processes, so increasing capacity, quality and productivity;
  • capital spend on the Company’s ESG programme;
  • capital spend on implementing the new SAP financial reporting and SAP system; and
  • funding to augment working capital in support of anticipated future growth

The net proceeds of the Placing will be principally invested by the Company in developing the EV product market opportunity. The EV market is seeing high levels of growth and the Directors believe that this presents significant further opportunities for the Group.

The Placing will also provide the Selling Shareholders with a partial realisation of their holding in the Company, which will help to provide additional liquidity for the Ordinary Shares following Admission.

The Perivan shareholder communications team were delighted to work with Singer Capital Markets who were appointed as Nominated Adviser, Sole Broker and Sole Bookrunner to Strip Tinning on the successful publication of the 138-page admission document.

 

Perivan specialise in the production and publication of financial documents relating to shareholder and investor communications for quoted companies, private companies and open and closed-ended funds.

 

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