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Softcat leads the way

More than a week since Softcat went public and it is clear that its move to become a PLC will have benefits for the rest of the channel

It has been a little over a week since Softcat became a PLC and while the management of the channel player is very much stressing that it remains business as usual the flotation should have a lasting impact on the industry.

The ripples following the entry onto the Stock Market spread out much wider than just the changes it has meant for Softcat's management and staff.

Firstly, the backing that Softcat received from investors, including some of the large institutional players, indicated that the appetite for putting money into the channel is out there.

There have been moments over the last few years when it was felt that sometimes the value that the channel brings, both at a reseller and distributor level, possibly eluded the investment community.

Along with difficult economic conditions a sense that there was a lack of faith from the markets in the channel presumably explains why Softcat breaks almost a decade of inactivity when it comes to IT solution providers going public.

But the backing that Softcat recieved prior to the moment it became a PLC as well as the demand for shares following the its shares being launched provides encouragement to others that might follow in the footsteps

"We were really pleased with the general investor interest," said Martin Hellawell, CEO of Sofcat, who has been speaking to the investor community since around May right up to the moment the listing went live.

"We have been delighted with the sort of investors that came through and I have been pleased with the relationship that we have made with those people," he added.

The reasons why those investors wanted to get involved -  a solid and growing channel business that had a very positive culture around developing staff - is not going to change post flotation.

Hellawell has spent this week going round the country to the various Softcat offices talking to staff stressing that it remains very much business as usual.

There are no plans for acquisitions or overseas expansion but just a concentration of making sure that what has worked so far keeps delivering for staff, customers and vendor partners.

Secondly, the position for the channel in terms of profile is also improved with Softcat demonstrating that it has reached a level of maturity that makes it a serious company with a brand that now starts to reach out beyond those with prior knowledge of the company.

Rising value

Softcat shares started trading on the Stock Exchange last Wednesday (18 November) with the company valued at £472.3m.

Shares rose even before trading began and kept their momentum and are currently up from the original valuation at around 285p per share.

Hellawell gives credit to Computacenter for flying the flag for the channel on the stock exchange for so long and hopes that it can follow its example and also boost the profile of the channel.

Thirdly, the Softcat story shows that putting belief in people and investing in the next generation can not only help develop a positive culture that leads to a firm garnering hatfuls of awards, but is also shows what can be done to those that have a bigger strategy they are working towards.

Hellawell is a well known figure in the industry and has already had chats with several about his experience of going public, and while he admits it has been hard work and not something everyone will want to go for, there might well be some that are inspired to follow in his footsteps.

Those that do take inspiration and start to plan a move public will have Softcat to thank for demonstrating so clearly how much support there can be out there in the City for sound channel companies.

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