$13.7 Million Sought in Kofax Initial Stock Sale

Kofax Image Products Inc., which makes software and hardware used to convert paper documents into electronic images, plans to raise at least $13.7 million in an initial public offering.

The company plans to sell 1.3 million shares of common stock for $12 each, according to a registration statement filed Thursday with the Securities and Exchange Commission.

Current shareholders will sell an additional 700,000 shares, raising the total offering to 2 million shares and giving new investors a 37.8% stake in the company, the filing said.

At $12 a share, Kofax would have a market value of $63.5 million, with about 5.3 million shares outstanding after the first-time stock sale, according to the filing.

Chief Executive David S. Silver, 39, a co-founder of the 12-year-old company, will not sell shares in the offering, retaining a 7.1% stake afterward, the filing said.

Aspen Venture Partners L.P., which is selling 285,479 shares, will remain the largest shareholder in Kofax, with a stake of 14.6%, according to the filing.

The imaging products maker earned $2.1 million for the year ended June 30, compared with a loss of $733,000 the year before, the filing said. Revenue totaled $29.3 million, up 17.3% from $25 million.

Kofax plans to use some of the proceeds from the stock sale to repay its outstanding credit line of $821,400. The rest of the proceeds will go for working capital and general purposes, which could include acquisitions, although none is in the works now, the filing said.

Needham & Co. and Unterberg Harris will underwrite the sale of shares, which Kofax plans to have trade on the Nasdaq Stock Market under the symbol KOFX.