Part of the Pertemps empire of Midlands entrepreneur Tim Watts floated on the AIM market yesterday.
Birmingham-based Network Group Holdings, the specialist recruitment and business outsourcing group, has made the move to go public.
The business was recently incorporated as a holding company having acquired the whole issued share capital of Network Ventures which was demerged in January 2004 from Pertemps Group, one of the UK's largest independent recruitment businesses.
Following the acquisition of ESOS Group, a business process outsourcing firm, also formerly part of Pertemps, and a recent re-organisation, Network now comprises more than 20 specialist recruitment and outsourcing companies and employs approximately 380 staff across the UK.
The flotation did not include the Pertemps recruitment high street branches, nor the employment and development specialist operation, Pertemps People Development Group.
On a pro-forma basis, the companies which now form Network, recorded a turnover of £52.1 million and earnings before interest, tax, depreciation and amortisation (EBITDA) of £1.9 million in the year to December 31.
The market value of Network is £14 million on flotation and the company will receive up to £1.5 million from the proceeds of a private fund-raising to employees, employees of the wider Pertemps group and certain other individuals.
The board decided not to undertake an associated institutional fund raising, but says it will keep the matter under review.
Mr Watts, chairman of the Pertemps Group, and the majority shareholder prior to flotation, will hold less than 30 per cent of the equity going forward. The remainder will be largely in the hands of Network and Pertemps employees - Mr Watts says he wants to encourage employee equity participation. None of the shareholders are selling their shares.
Network says it has listed on AIM to provide potential access to capital to finance growth and to enable it to use its shares as consideration for acquisitions.
"In addition, and fundamental to the listing, this provides a mechanism for employee shareholders to convert shareholdings in a private company into publicly quoted shares," said a statement from the firm.
"This will provide a means to further Network's philosophy of shared equity participation among their entrepreneurial managers. The ability of entrepreneurial recruitment professionals to generate personal wealth by building a business within this structure has proved a compelling factor in attracting businesses to join the company."
Network's recruitment business is grouped into three areas - professional, public and technical.
In addition, ESOS provides support services to Network's operating subsidiaries, parts of the Pertemps Group as well as a number of external organisations. The services provided by ESOS include, payroll, credit management, IT maintenance and web-based solutions.
Network stated: "The board is focused on developing its existing highly diversified businesses, making acquisitions to widen the services currently provided and investing on a selective basis in start-ups which complement the group's operations."
Mr Watts, said: "I am delighted to announce the admittance of one of the Pertemps family structures on to the Stock Exchange.
"It is my passionate belief that we continue to provide opportunities for equity participation for employees in our family group of companies and the admission of the Network Group to AIM is a further important step in this process."
Paul Doona, finance director of Network, who managed the flotation process, said: "For our entrepreneurial managers the listing provides evidence of the real wealth opportunities which are available as they are successful in continuing to grow their businesses.
"We also believe this will attract other entrepreneurial businesses to Network Group in the future."