PLUS-listed Keycom, which installs phone and broadband connections in student accommodation, has raised £1.5 million through a placing. The company has also converted loan notes worth £4.5 million held by three of its institutional investors into equity.

PLUS-listed Keycom, which installs phone and broadband connections in student accommodation, has raised £1.5 million through a placing. The company has also converted loan notes worth £4.5 million held by three of its institutional investors into equity.

Finance director Graham Robertson tells GrowthBusiness that before the placing could happen Keycom was obliged to clear up legacy issues, including litigation, that were left over from the tenure of its previous management team.

Robertson says: ‘Raising finance for our future expansion was not realistic while litigation remained outstanding.’

New investors bought into Keycom at 2p per share, while the institutions converted their loan notes to equity at 6.8p, for which Robertson is ‘very grateful’.

Robertson adds that the new funds will be used to boost sales and marketing efforts.

Keycom has just released its annual results to September 2007, which show turnover up 61 per cent to £1.8 million and losses before tax and interest payments at £1.7 million compared with £1.6 million the year before.

The company’s sales have been buoyed by a deal signed with former rival Catalyst which allows Keycom to service Catalyst’s contracts with the option to buy the company out at a later date.