Franchise lettings chain Martin & Co announced this morning that it is to float on the AIM market of the London Stock Exchange, with dealing expected to start on December 18.
The float will involve a placing of shares to raise £4m for the company, plus a further placing to allow a partial exit of the founders, husband and wife Richard and Kathryn Martin.
MartinCo Group – its official name – currently has 157 franchisees trading at 187 offices, with a further two offices that are currently owned by the company. The group recently added sales, and 95 of its franchised offices now also operate estate agency services.
The company will join its competitors Belvoir on AIM. It has been highly successful since its launch as a franchise model in 1995. It has a high level of franchisee retention with 63 franchises having been with Martin & Co over five years. All told, the franchisees manage some 30,000 properties, and last year agreed over 25,000 lettings. In 2012, eight franchise owners earned £500,000 or more.
Combined turnover of the network was £35m last year, with £37m expected this year. The franchisees pay an initial fee plus a management services fee of 9% of turnover.
In this morning's statement, the company said that the private rented sector had grown and that the franchisees had a 1.4% market share in the places they operate: "The directors therefore believe there is a large and growing potential market to capture," said the statement. "The directors believe that the UK lettings market is highly fragmented and split."
The statement continues: "The directors believe there is a clear opportunity for Martin & Co to further grow its national franchise brand through a combination of organic growth, an acquisition programme and the expansion of its estate agency network."
Richard Martin who founded the business is now its chairman and is 62. He started his career typesetting in local papers before going over to the advertising side, becoming advertising manager for a string of free titles in the west country. He and his wife Kathryn set up Martin & Co in 1986. Originally, it was a conventional letting agency and it was not until the mid-nineties that it launched its franchise model.
The firm's chief executive officer is Ian Wilson, who joined from Connells where he was lettings director. Non-executive director is Paul Latham who was deputy CEO of LSL until 2010, and a non-executive director of LSL until last year.