Vela Technologies PLC (LON: VELA) share price rallied 14.1% after investing £250,000 in Skillcast Group plc's IPO funding round, which raised £3.5 million for the company and £1 million for selling shareholders.
Skillcast was founded 20 years ago and provides software and content subscription services to help companies meet their employee compliance and training needs. It offers a portfolio of professional services to its clients, including FTSE 100 companies such as Fresnillo, Schroders, and GKN.
The firm also has clients in multiple industries within the European Union and other countries across the globe. Today’s IPO values Skillcast at £33.1 million, and Vela will own 0.76% of the company’s outstanding shares after their admission to trading.
Skillcast has a record of continuous growth and profitability. In the last five years, it has generated positive cash flow and has paid a dividend of approximately £0.4 million in 2018, 2019 and 2020.
Vela Technologies shares have been falling since spiking higher on 8th – 9th September as investors sentiment waned. However, today’s announcement triggered a rally at a crucial support level, and many investors hope that the rally will continue.
Vela’s investee companies such as St George Street Capital Holdings and Aeristech Limited have significant revenue potential and could generate high returns for the company in future.
Skillcast is also likely to generate a positive return for Vela in the near term when it issues the dividend payment for 2021.
James Normand, Vela’s Executive Director, commented: “Skillcast has used its distinctive software to carve out a leading position in its market. Vela's investment reflects its confidence in the plans for growth formulated by Skillcast's first-class management team; and fits Vela's underlying strategy to build capital value for its shareholders by identifying market-disrupting technological innovation.”
Investors interested in opening new positions in Vela Technologies may find its current prices quite attractive. However, there are no guarantees that we won’t see further price declines in future.
*This is not investment advice. Always do your due diligence before making investment decisions.
Vela Technologies share price.
Vela Technologie share price rallied 14.11% to trade at 0.0542p, rising from Tuesday’s closing price of 0.0475p.
Vela shares are traded on the London stock exchange's AIM market (the alternative investment market), which is the submarket specifically for smaller companies. AIM stocks are attractive to investors as they have tax advantages and smaller companies have the potential to benefit from rapid growth. But are Vela shares the best buy? Our stock market analysts regularly review the market and share their picks for high growth companies.
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