Peter Strom

It used to be a great way of cashing out, but these days, according to March Networks CEO Peter Strom, mounting an IPO is a solid strategy to plan corporate growth and longevity.

Mr. Strom will present his ideas on IPOs at OCRI's Technology Executive Breakfast Thursday at the Corel Centre.

He recently led March through its own IPO – the first major one in Ottawa since 1999 – when the company's shares opened at $13 on the TSX April 27. In the first 90 minutes, more than 400,000 shares changed hands at prices ranging from $12.41 to $13.25.

Before trading began in Toronto, the company announced the official closure of its initial public offering of 5,736,850 common shares at a price of $12 per share, which garnered more than $70 million in new capital.

The shares began trading simultaneously on the TSX and AIM, an alternative market in the U.K. operated by the London Stock Exchange.

Last Wednesday, the company raised an additional $5.3 million after underwriters RBC Capital Markets and Evolution Securities, along with Wesley Clover Corp., exercised their over-allotment option to purchase an additional 860,000 shares.

"I'm going to talk about the experience of an IPO," Mr. Strom said. "The dynamics of an IPO has changed over the years. Back then it was considered a good exit strategy. Now the investment community is looking at the long-term growth of the company."

Still, an IPO isn't all things to all people. There's no guarantee of success in an industry of such unpredictable ups and downs.

"The high tech market is skittish," he added. "Investors look at this sort of thing more carefully than they used to."

Before March went public, Mr. Strom did his due diligence by consulting with other captains of industry to gauge their reaction to his plans.

"When we were planning to do this, I talked to a lot of other CEOs. They gave us a lot of good support. They were pushing for us and they watched to see the reaction to this. I t has been very positive."

That is fact. While the price spiked on the first day of trading, it has held firm at the issued price of $12.

"We did it during a down time in the tech sector, but now it's turning around."

Even after balancing the risks of such a bold move, however, he warns that the future cannot be anticipated much more than three years out thanks to the pendulum that is high tech.

Mr. Strom added that he couldn't comment on whether all aspects of the tech industry will thrive in the near future, but did say the security aspect of it looks to be very strong.

March develops and markets IP-based digital video surveillance products and has managed to fill a profitable niche providing security to U.S. banks and transit systems.

For more information on this and other OCRI events, call 828-6274 or visit www.ocri.ca

By Scott Taylor

scott.taylor@transcontinental.ca