Entrepreneur John Florey is seeking to raise between £750,000 and £1.25 million in a pre-float funding for The Kalashnikov Joint Stock Vodka Company (1947).

The company, maker of ‘AK47’ and other vodka brands, intends to tap AIM later this year for a £6.6 million funding programme. Florey is the founder of the company, whose present backers include Michael Alan-Buckley of investment powerhouse RAB Capital, and he plans to embark on an expansion drive to take turnover from 2007’s modest £121,345 to £6 million in three years.

Kalashnikov, whose honorary chairman, General Mikhail Kalashnikov, is the Russian engineer who designed the AK47 rifle, owns two vodka brands. ‘Kalshnikov’ itself is distilled in Russia and bottled in the UK as a high-strength premium brand, while the somewhat lower-strength ‘AK47’ is distilled in Britain and marketed on price.

The company is developing a third brand, ‘Gun Metal’, for the ‘super-premium’ market, starting in the USA. Florey and colleagues hope this brand will emulate the sales growth of the other two, whose combined case sales rose from 212 to 5,230, 97 per cent exports, between 2004 and 2007.

As yet, profits have eluded Kalashnikov, which has been spending on marketing and development and lost £379,000 last year. However, broker VSA Resources predicts the total planned capital raising will yield £1.7 million annual pre-tax profits in three years, rising to £4 million three years after that.

Kalashnikov has raised nearly £4.5 million privately since 2003 at prices ranging from 5p to 31p a share. The current round is likely to be priced comparatively modestly.

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