Shares in specialist software and consultancy outfit FD Technologies (FDP:AIM) have already surged in 2024 and got a further boost on confirmation of the sale of its First Derivative business to US software giant EPAM Systems (EPAM:NYSE) for £230 million.

Proceeds of the sale will be used to repay £20 million net debt, the company said, and excess cash will be returned to shareholders.

The divestment will also allow FD Technologies to focus on KX, its AI (artificial intelligence) driven analytics software business which Investec sees as a ‘key beneficiary of generative AI’.

‘The kdb+ product is arguably the leading worldwide vector database, but proprietary language and original on-premise characteristic have historically been barriers to adoption. With these addressed in recent years, generative AI could be the killer app,’ Investec observes. 

The company’s shares have built momentum since a strategic review in March when the board separated the firm’s three businesses – KX, First Derivatives and marketing tech arm MRP.

‘We view today’s news (7 October) as incrementally positive both in terms of trading performance and the separation of KX and First Derivative, allowing the share price to build on recent performance,’ noted analysts at Shore Capital.

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