MusicMagpie swoops towards £200m float on London stock market

15 April 2021, 16:10 | Updated: 15 April 2021, 17:45

MusicMagpie will on Friday become the latest online platform to confirm plans for a public listing when it swoops onto London's junior stock market.

Sky News has learnt that the "recommerce" site, which specialises in reselling used consumer technology such as smartphones and games consoles, is to publish details of a placing and proposed admission to AIM following successful talks with prospective investors in the last fortnight.

City sources said that musicMagpie was expected to seek a market capitalisation of about £200m.

The company's initial public offering (IPO) will add it to an unprecedented flurry of technology-based companies selling shares on London's equity markets, with Trustpilot, Moonpig and Deliveroo all floating so far this year and THG - owner of The Hut Group - last autumn.

Darktrace, the cybersecurity company, has confirmed plans to list, while the payments app Wise is expected to follow suit before the summer.

MusicMagpie, which launched in 2007, pays consumers for unwanted products that it can resell.

Run by founder Steve Oliver, it claims to recycle 95% of the products it acquires, and uses parts from the remaining 5% to refurbish other items.

Its environmental track record means it is expected to qualify for the London Stock Exchange's Green Economy Mark on admission of its shares, which recognises companies deriving at least half their revenues from products and services which contribute to the sustainability agenda.

To bolster its credentials as a public company, musicMagpie has appointed Martin Hellawell, the chairman of the listed IT infrastructure business Softcat, as its chairman.

MusicMagpie has established itself as the biggest global third-party seller in the history of Amazon Marketplace, achieving 10 million global feedbacks across the online retail behemoth's platforms.

It says it is also the biggest global seller in eBay's history, while also selling direct to consumers through its own online stores.

The company has benefited from consumers' desire to declutter their homes during the COVID-19 crisis, while also helping them to generate cash during more challenging economic times.

It trades under the Decluttr brand in the US.

Existing shareholders including the private equity firm NVM are expected to sell part of their holdings in the IPO.

According to insiders, earnings before interest, tax, depreciation and amortisation soared from £2.6m in the year ended November 2018 to approximately £13.9m in the year to 30 November 2020.

MusicMagpie is said to see significant growth potential in a new smartphone subscription and rental service, as well as a kiosk concept being introduced in Asda and Co-op supermarkets which allows sellers to recycle their phones for instant cash payments.

The IPO is being by the investment banks Peel Hunt and Shore Capital.

A musicMagpie spokeswoman declined to comment on Thursday.