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Orchid Technology Inc, the Fremont, California add-on Personal Computer board manufacturer that had to withdraw its placing in January for technical reasons (CI No 598), is trying again next month. The company is placing about 20% of its equity and will price the issue to raise about UKP5m, valuing the company at about UKP25m, through Phillips & Drew. The share price has not yet been set, but is likely to be about UKP1. Orchid is now able to confirm the forecast it made last time, that it did $3.0m pre-tax on sales of $11.4m, and is forecasting $6.5m for the full year to June on sales of $25m. The $11.4m figure for the half is greater than sales for the full year in fiscal 1986, and compares with just $37,000 pre-tax on $726,000 sales in 1983. The company currently specialises add-on boards for the IBM Personal family, and claims to have information from IBM that satisfies it that they will also work on the new Personals due out on April 2. It is now defining new products that it wants to build for the upcoming IBM line, including memory, graphics, accelerator and desk-top publishing products. In particular it has designed its own Extended Graphics Adaptor chip that costs it $10 a shot against the $40 it had to pay when it bought a comparable product off the shelf, and is now looking to sell the new chip on to other manufacturers as well as building it into its own product. It also has an 80386 board for the IBM AT that it claims gives the machine the same performance as the Compaq Deskpro 386. Orchard is also excited enough about the new Macintosh II and SE that it is diversifying into that market, and has joined Apple Computer’s Third Party Products Engineering Programme. US companies coming to the London market have been regarded with considerable scepticism and wariness since the underwriters were held holding most of Mrs Fields’ crumbled cookies last summer, and the likes of Borland International came to the London market trumpeting that it was not another Mrs Fields. Would that it were. The delectable Debbi duly beat her prospectus profits forecast the other week, announced gaily that she was now trading profitably in every country, had enticing plans for product diversification – and capped all that with the killer punch that the worries over a soaring tax charge had been squashed by the new tax regime in the US. The shares are now trading at about 55% above their issue price, the underwriters are laughing all the way to the nearest cookie counter, while the Borland share price, following product delay after product delay, has only just moved back above its issue price. Is Orchid another Borland or another Mrs Fields? And why did it come to London? It wanted to raise only a comparatively small sum (that’s encouraging) and the underwriting charges in the US would have taken far too big a bite.

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