Bravura, the Australian technology provider which supplies the software behind Nucleus and Aviva’s platforms, is seeking to raise £16.7m, or AUS$33.4m, in a rights issue as Bank of Scotland International is demanding that the firm reduce its debts as a condition of its loan renewal.
Ironbridge will be entitled to 87 million free options for underwriting the deal and will also be able to appoint two directors to Bravura’s board.
If investor take-up of Bravura’s rights issue is low, Ironbridge could end up with a controlling stake in the firm.
Ironbridge is also repaying a loan on behalf of Bravura’s joint chief executive officers Iain Dunstan and Simon Woodfull to another firm, Lift Capital, which is now insolvent.
This means the debts will now be owed to Ironbridge instead of the liquidated firm.
In a letter to shareholders released on the Australian Securities Exchange Bravura chairman Chris Ryan says: “Depending on the extent to which shareholders take up their rights entitlements, whether Ironbridge exercises any of its options and whether Ironbridge enforces its security rights in connection with the proposed new margin loans to be made to Messrs Dunstan and Simon Woodfull, Ironbridge could end up with a controlling stake in Bravura.”
Ryan adds: “These agreements will provide a complete solution to the uncertainty for Bravura and its executive directors created by the insolvency of Lift Capital in April 2008.”
The rights issue proposal, grant of options to Ironbridge and new margin lending arrangements will all be subject to shareholder approval, which will be discussed at the firm’s general meeting in June.
Finance and Technology Research Centre director Ian McKenna says: “Given the significant number of UK organisations who use Bravura any uncertainty over their future could cause some concern. It will be important for them to move quickly to provide confidence to the market and advisers who use their customers.”