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Small Cap Wrap – Landore Resources, Genedrive, Gamma Communications and more…


03 March 2021


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What’s cooking in the IPO kitchen?

Proposed move to AIM from the main market (standard)  by Emmerson (LON:EML)  to provide Emmerson with access to a market and environment which is more suited, in the Board’s view, to the Company’s current size and strategy ahead of pivotal period for the Company with the commencement of mine construction at the Khemisset Potash Project expected by end of 2021. Follows recent award of Mining Licence granting Emmerson exclusive right to develop and mine the potash deposit and £5.5m raise to fund ongoing project development work. Subject to EGM on 21st March. 

Rogue Baron plc have announced its application for admission to the AQSE growth  market.  Rogue Baron owns five subsidiaries, namely: Shinju Spirits, Inc., Shinju Whiskey LLC, Mazeray Corporation, STI Signature Spirits Group LLC and Legacy Retail Group LLC.  The Company’s goal is to build each of its brands that makes them a buyout target.  Deal size TBC an expected admission date 12th March 2021. 

Global review platform, Trustpilot has announced its intention to float on the premium list of the LSE.  Trustpilot provides an open platform, which creates a place where businesses and consumers can gain actionable insights and collaborate. Consumers are able to share feedback, at any time, about any business with a website and review feedback left by other consumers.  Total revenues were US$64.3 million, US$81.9 million and US$102.0 million for the years ended 31 December 2018, 2019 and 2020, respectively.  The Offer would comprise new Shares to be issued by the Company (raising gross proceeds of approximately US$50 million to support Trustpilot’s growth plans and repay indebtedness) and an offer of existing Shares to be sold by certain existing shareholders, directors and employees.  Timing TBC. 

In The Style, the e-commerce womenswear fashion brand with an influencer collaboration model, announces their intention to float on AIM.  In The Style is a pure-play e-commerce fashion brand with a l customer base of women predominantly aged between 16 and 35. Founded in 2013, the group has delivered £35.4 million net sales and £3.6 million Adjusted EBITDA in the nine months to 31 December 2020, with sales up 159% from £13.7 million for the nine months to 31 December 2019.  Admission is expected to take place on or around 17 March 2021.  Deal size TBC. 

Media reports video game firm, Catalis is mulling a London IPO, just over a year after being bought by a private equity firm.  Catalis’s accounts are reportedly expected to show revenues increasing to £60m in 2020, up from £43m, with adjusted earnings of £15m.  Deal details and timing TBC. 

tinyBuild— a leading video games publisher and developer with global operations. tinyBuild’s strategic focus is in creating long-lasting IP by partnering with video games developers, establishing a stable platform on which to build multi-game and multimedia franchises is to join AIM. Offer details TBC.  Due mid-March.

AMTE Power,  a developer and manufacturer of lithium-ion battery cells for specialist markets, announced its intention to seek admission to trading on AIM. Admission is expected to take place during March 2021. The Company intends to raise approximately £7m by way of a placing of new ordinary shares in the capital of the Company. Timing TBC.

Samarkand Group Limited, the cross-border eCommerce technology and retail group opening up the world’s largest market for brands and retailers, intends to IPO on  the Apex Segment Aquis Stock Exchange Growth Market. Admission is targeted for March 2021.

NextEnergy Renewables  to launch an IPO on the Main Market. NREN is a differentiated renewables investment Company that aims to capture the most attractive private renewables and energy transition infrastructure investment opportunities globally.  Targeting a £300m raise.   NREN is targeting total returns of 9-11 per cent. per annum (net of all fees and expenses but including the Target Dividend and capital appreciation) . The Company’s target dividend yield for the first full financial year to 31 December 2022 is 5.5 pence. Due Early March 2021.

Digital 9 Infrastructure launch an initial public offering  on the Specialist Fund Segment of the Main Market of the London Stock Exchange, by way of an initial placing and offer for subscription for a target issue £400m. Digital 9 Infrastructure plc is a newly established, externally managed investment trust. The Company will invest in a range of digital infrastructure assets which deliver a reliable, functioning internet. The IPO Prospectus is expected to be  published in March 2021.

Team PLC announced their plans for an AIM IPO.  Team owns Theta Enhanced Asset Management Ltd, trading as Team Asset Management. This is a Jersey-based active fund manager providing discretionary and advisory portfolio management services to private clients, trusts and charities. Assets under management were GBP291m in November, up from GBP140m in December 2019 .   The Company is seeking to raise  no less than £5m.  The Placing will be priced on a pre-money valuation for the Company of £7m. Targeting March Admission.

Fix Price announces its intention to float on the Main Market of the London Stock Exchange.  Fix Price is one of the leading variety value retailers globally and the largest in Russia, with more than 4,200 stores. Fix Price has revenues of RUB 190.1bn, RUB 142.9bn and RUB 108.7bn for 2020, 2019 and 2018, respectively. Adjusted EBITDA for the same years was RUB 36.8bn, RUB 27.2bn and RUB 14.2bn, respectively. The Offer would consist of an offering of GDRs by certain existing shareholders of the Company.

Great Point Entertainment Income Trust PLC announced its prospectus has been approved by the FCA.  Great Point Entertainment Income Trust PLC is a newly established, externally managed closed-ended investment company. The Company will provide project finance to content makers and commissioners in the global television and film production industry via senior loans secured against pre-sold intellectual property (IP) rights. GPEIT’s investment objective is to provide Shareholders with dividend income and modest capital growth through exposure to media content finance.

According to media reports, Deliveroo is expecting to release its IPO plans on 8th March.  The company raised more than $180m in January with a valuation of more than $7bn. 


Banquet Buffet

Landore Resources 29.75p  £31.1m (LON:LND)

Update on the drilling programme at the BAM Gold Deposit and the Company’s existing Battery Metal resources on its highly prospective Junior Lake Property, Ontario, Canada. The Drilling Programme is proceeding as scheduled with results received to-date confirming the depth and length extensions of the BAM west pit. In addition drilling to the east and west of the BAM Gold Deposit has successfully intersected the favourable lithology and mineralized structures associated with the BAM Gold Deposit. Assay results will be reported once received and collated.

The growing adoption of electric vehicles (EVs) is driving the increasing demand for nickel, cobalt and lithium – which are each critical metals used as cathode materials for lithium-ion batteries in the automotive industry, as well as the energy and electronics industries.  In addition to advancing the BAM Gold Deposit on which Landore remains focused, the Company is encouraged by the increased demand for ‘Battery Metals’ as Landore’s highly prospective Junior Lake property is host to significant Battery Metals Resources and prospects delineated by Landore prior to the discovery of BAM Gold. These resources are compliant to Canadian National Instrument 43-101 (NI43-101).


Genedrive  132p  £83.6m (LON:GDR)

The near patient molecular diagnostics company, provides an update on its Antibiotic Induced Hearing Loss (AIHL) assay. As announced on the 3 December 2020, an 11 month implementation trial at Manchester University NHS Foundation Trust and Liverpool Women’s Hospital successfully concluded in November 2020. The results of the study will be published in a peer reviewed journal. The study’s primary outcomes were very positive, showing genedrive’s utility as the world’s first rapid genetic test in an emergency care neonatal setting.   

Since completion of the trial, there has been new clinical guidance in the UK on the importance of the management of specific genetic mutations and their role in hearing loss as a result of antibiotics (ototoxicity). Government and Society guidance are considered a key factor influencing the speed and extent of future adoption. The Company and Inspiration Healthcare Group plc (AIM: IHC), the distribution partner for the AIHL assay, believe this will lead to increased demand for the genedrive AIHL test in the UK.  This new government guidance reminds healthcare professionals about the impact of antibiotic related ototoxicity and to consider the need for genetic testing prior to initiation of treatment. genedrive’s assay is the only commercial point of care test available for the testing of MT-RNR1, the most important mutation contributing to AIHL in infants. The launch of the genedrive AIHL assay remains on track for summer 2021.


Gamma Communications 1557.5p  £1486m (LON:GAMA)

The technology-based provider of communications services to the business markets in the UK and mainland Europe has acquired the entire issued share capital of Mission Labs Limited  on 2 March 2021.

 This acquisition gives Gamma additional capabilities in the rapidly evolving markets of Cloud Contact Centre and Cloud Communications. The initial consideration for the entire issued share capital of Mission Labs is £40.2m on a cash free basis with up to an additional £6.0m contingent deferred consideration payable over the next three years assuming certain development milestones are met on the existing and future product set. Annual run rate revenue at the time of acquisition had grown to approximately £8m (unaudited).  While the acquisition is expected to be accretive from day one, additional investment is planned which is expected to deliver greater growth over time.


Solid State 820p  £70.05m (LON:SOLI)

The manufacturer of computing, power and communications products, and value added supplier of electronic and opto-electronic components, announced the acquisition of Willow Technologies Limited and its subsidiaries for an initial consideration of £10.0m, which, when adjusted for the cash on the balance sheet, results in an effective net initial consideration of approximately £5.5m.

· Willow Technologies with American Electronic Components Inc. (AEC) (its US based subsidiary) is a manufacturer and value added distributor of electro-mechanical products used in strategic, structural, growth markets.

For the year ended 31 March 2020, Willow Technologies reported revenue of £10.3m, profit before tax of £0.45m and had net assets of £7.0m.

The business experienced a significant downturn in the first half of the current financial year principally due to the COVID-19 pandemic. In recent months, both orders and billings have seen a strong recovery. Although revenues to 31 March 2021 are expected to be down on the prior year, at circa £8.75m, management took appropriate actions to control costs which has meant the business will continue to be profitable with underlying profit before tax expected to be circa £0.6m.


Urban Logistics  146.5p  £373.6m (LON:SHED)

The specialist UK industrial and logistics REIT, announced the £23.0 million forward funding of two development sites. The Company has exchanged contracts with Wilson Bowden Developments Limited, conditional on receipt of planning permission, for the forward funding of five high-quality urban logistics assets at Nottingham and Leicester. All assets are expected to achieve an EPC ‘A’ rating. 

The maximum commitment for the Acquisition is £23.0 million and will be financed from a combination of the Company’s cash resources, the sale of logistics properties and debt financing. The development yield on cost is 6.12%. The 8.1-acre site at Blenheim Park, Nottingham, will comprise four units with a total gross internal floor area of 166,330 sq ft. Blenheim Park benefits from a location that is 1 mile from junction 26 of the M1. The 2.5-acre site at Optimus Point, Leicester, will comprise one unit with a gross internal floor area of 43,850 sq ft. Optimus Point benefits from a location that has direct access to junction 21a of the M1. During construction, which is expected to commence in September 2021, the Company will benefit from a 5.5% interest rate coupon on the forward funding provided


Real Estate Investors  33.5p  £60.01m (LON:RLE)

The UK’s only Midlands-focused Real Estate Investment Trust (REIT), with a portfolio of 1.59 million sq. ft. of investment property across all sectors, today announced the refinancing of its existing debt facilities/  The Company’s £51 million RBS term loan facilities, due to expire in February 2021 (£41 million) and August 2023 (£10 million), have been renewed with National Westminster Bank plc (following its merger with RBS) for a further 3 years at 2.25% above LIBOR, with expiry of this facility due in March 2024, secured on a portfolio of the Group’s properties. The average cost of debt across the Group remains at 3.4%.


Coral Products 11.5p  £9.5m (LON:CRU)

The specialist in the design, manufacture and supply of plastic products based in Wythenshawe, Manchester, has acquired the entire issued share capital of Customised Packaging Limited for a net consideration of £1.25 million  plus a conditional earn out. CPL designs, manufactures and supplies plastic products using their top of the range sheet extrusion technology and vacuum forming capability to a range of a blue-chip customer’s own design specifications.  CPL, which is based in Manchester will continue to operate from its existing premises.

As per the unaudited management accounts, in the year ended 31 December 2020, CPL’s sales were circa £2.3 million and the net asset value was £0.7 million.  Pursuant to the terms of the share purchase agreement, the Vendors have given warranties and indemnities in favour of the Company.


W Resources 0.0925p  £7.13m (LON:WRES)

Update on the Plant Improvement Programme at the La Parrilla Mine in Spain, which has now been successfully completed:

Improved efficiency and increased production of tin and tungsten concentrate.  Concentrator plant recovery for tungsten during February was greater than 60% – an all-time high. Despite unprecedented rainfall which has slowed Q1 progress, tungsten and tin concentrate production in Q1 and Q2 2021 is expected to be ahead of any previously reported quarter.

Two shipments of 20t of tungsten concentrate completed and shipped in the past 2 months · One shipment of 20t of tin concentrate was shipped on 1 March and this shipment benefited from a 26% increase in the net price received vs the previous tin shipment. · One shipment of 20t of tungsten concentrate is due to be shipped on 8 March 2021


SourceBio 187.5p  £139.1m (LON:SBI)

The international provider of integrated state-of-the-art laboratory services and products, announces that its laboratory operations in San Diego, California, are to be expanded to include COVID-19 qPCR testing services. 

The division based in the Torrey Pines Genomics hub of the US, and home to prestigious as the Scripps Research Center, will mirror that of the Company’s set up in Nottingham, England, and is expected to be fully operational in Q2 2021. 

The Group’s existing San Diego facility currently houses Stability Storage Solutions and Genomics business units and the enhanced space is planned to have the capacity to process up to circa 5,000 samples per day with opportunities for continued growth.  


Maestrano Group 13.75p  £21.1m (LON:MNO)

The Artificial Intelligence platform for transport corridor analytics, announces a proposed placing via an accelerated bookbuild. The Placing will be conducted at a price of 13 pence per share in order to raise, in aggregate, approximately £2.0 million. The gross proceeds of the Placing will be used as follows:

–  c. £1.3m: marketing and technical staff –  c. £0.3m: premises and manufacturing capacity expansion –  the balance of gross proceeds: working capital and Placing expenses

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