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Alphawave shares slump on London debut

<p>Alphawave’s tech enables data to travel faster and more reliably using lower power, and is used in AI, cloud computing and for the development of driverless cars</p> (Alphawave)

Alphawave’s tech enables data to travel faster and more reliably using lower power, and is used in AI, cloud computing and for the development of driverless cars

(Alphawave)

Alphawave, the Canadian chip technology designer, slumped on its London debut today.

The four-year-old semiconductor firm selected the capital for its IPO over the Nasdaq and priced its shares towards the upper end of its range at 410p - implying a £3.1 billion market value.

But by 9am the shares were trading down as much as 15% at around 348.5p, giving it a market cap of around £2.6 billion.

Deliveroo's float famously flopped in London this year, but fellow tech firm, cyber security giant Darktrace, saw shares jumped as much as 44% on its cautiously-priced IPO last month.

The reception for Alphawave also comes as US investors exit tech stocks, amid concerns inflation and potential higher interest rates will hit returns.

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Executive chairman John Lofton Holt said this morning that "London was the obvious venue for the listing of our silicon IP business because both the industry and the business model were born in the UK".

ARM Group was Britain’s flagship listed semiconductor firm before it was taken private by SoftBank in 2016.

The majority of listing cash went to founders Tony Pialis, Jonathan Rogers and Rajeevan Mahadevan. The firm is to move its research base from Toronto to Cambridge after the float.

Alphawave's tech enables data to travel faster and more reliably using lower power, and is used in AI, cloud computing and for the development of driverless cars.

There is currently high demand for semiconductors around the world. The company has been profitable since its first year of operation in 2018, and its bookings, which reflect projected revenues, rose from $27 million in 2019 to $75 million last year.

Cornerstone investors on the float include BlackRock and Janus Henderson.

Barclays Plc and JPMorgan Chase & Co. are joint global coordinators on the IPO. BMO Capital Markets is joint bookrunner.

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