It's Tough Being a U.K. Listed Technology Company Right Now
(Bloomberg) -- Security-software developer Avast Software BV announced this week it intends to float in London in early May. It won’t be joining a happy bunch of U.K. public tech companies.
Sage Group Plc -- the largest U.K. tech company -- posted a surprise growth warning Friday. Shares fell as much as 20 percent in London, the biggest drop in over 24 years.
Its rival for biggest U.K. tech firm Micro Focus International Plc is having an equally torrid time of late. In January its shares slumped the most in almost seven years after predicting falling sales and reporting revenue at its freshly acquired HPE Software business.
The drop at Micro Focus was enough for Elliott Management Corp., the New York hedge fund run by billionaire Paul Singer, to build a position and plan to push for changes at the U.K. software company.
And in March Dialog Semiconductor Plc dropped as much as 10 percent, sending it to the lowest intraday since August 2014, amid a widespread selloff for chip stocks and after Bankhaus Lampe said that Apple Inc.’s insourcing of power-management chips is progressing “faster than feared.”
Even smaller tech companies are having a rough year. In February IQE Plc, whose shares have surged on speculation it’s selling parts used in Apple.’s iPhone X, became a target of Carson Block’s Muddy Waters. Despite recent results beating estimates. shares are down about 8 percent this year.
The problems affecting large-caps such Sage and Micro Focus are largely structural. At both companies sales have disappointed as Sage shifts customers to subscription models, and Micro Focus struggles to digest its $8.8 billion purchase of HPE software assets. IQE has recently appointed KPMG as its new auditor.
Still, it’s not all bad for Avast. Shares at rival Sophos Group Plc rose as much as 20 percent this month, its steepest intraday gain on record, after saying it sees full-year reported billings growth toward the top end of the previously guided range.
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