Best mates from the RAF to drift their £25m defence agency in London

A defence engineering consultancy run by two best friends who served together in the RAF plans to float in London this month.

RC Fornax wants to raise at least £5 million, valuing the business at £25 million, sources say.

The flotation will be a boost for the junior AIM market, which celebrates its 30th anniversary this year, but has been hit by changes to inheritance tax rules in Labour’s Budget.

The company was founded in 2020 by chief executive Paul Reeves, 41, and executive director Dan Clark, 40. ‘Dan and I are in lockstep,’ said Reeves. ‘We are best friends and always will be until the day we die.’

Between them they have more than 24 years’ service in the Armed Forces.

The company works with top tier defence firms to manage projects more efficiently.

High-flyers: RC Fornax founders Paul Reeves, left, and Dan Clark in front of the Tyne Bridge in Newcastle

Its revenues were £6.5 million last year. It hopes to tap in to the growth in defence spending amid rising global tensions.

The founders also have an eye on the goal set by the Ministry of Defence of directing a quarter of procurement spending to small and medium-sized businesses. Reeves hopes to form consortia with other small and mid-size firms to bid for MoD contracts.

He says the duo never considered a listing in the US, which is often touted as a more lucrative venue for floats.

‘I have always and will always be passionate about my country. It’s just not a question,’ he said, adding that he and Clark ruled out selling to private equity because they wish to keep control.

The proceeds of the fund raising will be used for development, including an AI tool to help with project management.

Early backers of the company include Reeves’ 70-year-old mother, Jane Cartwright. ‘She sold the family home in Filey, North Yorkshire, to support us,’ Reeves says.

‘It was our grandparents’ house where we went on holiday – so there were lots of childhood memories.

‘I told her not to sell it, but you can’t stop a mum helping her kids.’