MusicMagpie, the online reseller that specialises in secondhand tech such as smartphones and games consoles, has announced plans for a £208m flotation.
The initial public offering of MusicMagpie, which was founded in Stockport in 2007 and also has operations in the US under the Decluttr brand, is expected to raise £95m for selling shareholders.
After the listing on London’s junior AIM market, which will also raise £15m to pay down debt and expand its smartphone rental business, directors and senior management will own 11.5% of the company.
The company, co-founded and run by Steve Oliver, made £153m in revenues and £13.9m in profits in the year to the end of November. MusicMagpie, which last year began setting up kiosks in Asda and Co-op stores to recycle old phones for cash, makes 54% of revenues from the resale of consumer technology, 38% from “disc media” such as CDs, and 7% from books.
“We are thrilled that MusicMagpie’s circular economy model has resonated so strongly with investors,” Oliver said. “Given the ongoing move to tackle the growing problem of e-waste and the fact that consumer attitudes towards buying refurbished consumer technology products are rapidly changing, we believe there is significant potential for MusicMagpie’s future growth prospects.”
The company, which also lists products it sells across eBay and Amazon Marketplace, says that the market for pre-owned consumer technology and physical media is worth £9bn in the UK and US.
“In the UK alone, we estimate that people are sitting on around £16.5bn worth of technology that they no longer use,” Oliver said. “Only a small percentage of consumer technology items are currently recycled. The listing on AIM reflects not only the success that we have enjoyed to date but also our confidence in our ability to capitalise on the favourable long-term trends that continue to drive the company’s strong performance.”
MusicMagpie joins a string of UK-based technology companies turning to the stock market, including Moonpig, Deliveroo, the Hut Group and the cybersecurity company Darktrace.