Hybridan Small Cap Feast

A round up of the day’s news brought to you by the team at small-cap broker and advisor Hybridan.

Dish of the day

PensionBee has joined the High Growth Segment of the Main Market of LSE. The online pension provider had approximately 130,000 Active Customers and £1.5bn of assets under administration as at 28 February 2021. The Offer will comprise new Shares raising gross proceeds of approximately £55m and existing Shares to be sold by certain existing small minority shareholders of up to £5m. None of the founders, directors or members of senior management of PensionBee are selling any existing Shares. Offer price set at 165p implying a market cap of £365m.

Off the menu

No Leavers Today

Banquet Buffet

ADM Energy * 3.45p £5.24m (ADME.L)

The natural resources investing company has entered into a non-binding collaboration agreement (CA) with OES Energy Services Limited (OES), Nigeria’s largest swamp rig services provider, and 4Mation Drilling Services Limited, a solution provider in the energy sector. ADM, OES and 4Mation plan to explore opportunities to develop Barracuda Field in OML 141 and associated work-related activity in Nigeria. It is the intention of the Parties, together with the risk sharing consortium in respect of Barracuda Field, that a formal agreement will be entered into in advance of any work commencing. The CA may be terminated by mutual consent.  Subject to any potential formal agreement, the intention is for OES to provide the swamp drilling rigs required for the Project. 4Mation would provide a variety of project management services including well engineering services, technical personnel, security and logistics. In addition, OES and 4Mation may consider providing vendor financing to achieve the scope of work to be agreed, subject to term.

RTC Group 47.5p £6.8m (RTC.L)

AGM Update. “Throughout Q1 we continued to provide contract workers to the infrastructure and railway transportation sectors and internationally at similar levels seen in Q4 2020. General UK recruitment and smart-meter installation activities which were significantly impacted by the lockdowns in 2020 have picked up somewhat in the current financial year. Our hotel and conference centre provided bedroom and meeting room facilities to key workers in line with Government guidelines. The Directors believe that the number of contract workers required in the infrastructure and railway transportation sectors, internationally and for smart-meter installation activity will continue at similar levels as Q1 in Q2 2021 with hotel and conference centre activities picking up slightly as restrictions are eased. The Board still believe that it is too early to quantify the revenues and operational profits for the full calendar year 2021.  The Company’s interim results for the six months ended 30 June 2021 will be published on or around 26 July 2021.”

Savannah Resources 4.05p £58m (SAV.L)

The resource development company which is focused on becoming Europe’s most significant producer of spodumene lithium from its Mina do Barroso Project in Portugal, further to its announcement yesterday, has successfully completed a significantly oversubscribed Placing, which is now closed.  The Company has raised, in aggregate, £10 million (before expenses) through the Placing of 250,000,000 Placing Shares at a Placing Price of 4 pence per Placing Share and £0.3 million through a direct subscription   “The £10.3m raised combined with the US$6.4m investment expected from Galp Energia SGPS, S.A (‘Galp’) in the Mina do Barroso project holding company, and our existing cash reserves, puts Savannah in a strong financial position as we continue to move towards the development phase at Mina do Barroso.”

Distribution Finance Capital Holdings 63p £113m (DFCH.L)

The newly authorised bank providing working capital solutions to dealers and manufacturers across the UK, today announces its audited results for the 12 months ended 31 December 2020 and a Q1 2021 trading update.  Loan book growth was constrained during the year; since receiving the bank licence, momentum was rebuilt, ending up 36% by 31 December 2020 at £113m from a low point of £83m in October 2020. The loan book was carefully managed through the pandemic achieving results better than periods prior to COVID-19; at 31 December 2020, arrears represented 0.2% of the loan book. The Group successfully launched a range of retail savings products, raising over £145m in the 12 weeks to 31 December 2020, which enabled the early repayment of expensive wholesale funding and other debt.  The Group started 2021 entirely funded by retail deposits, which has transformed its net interest margin from less than 2% to approximately 6%. The loan book has had a strong start to 2021 exceeding £193m at 31 March 2021, up 70% from 31 December 2020. The Group completed a £40m fundraise in February 2021 increasing its capital base, providing the necessary funding to support its strategic plan in the short term.

Helios Underwriting 170p £115m (HUW.L)

The unique investment vehicle which acquires and consolidates private underwriting capacity at Lloyd’s announced the appointment of Tom Libassi and Martin Reith as Non-Executive Directors of the Company with immediate effect. Tom Libassi is the Co-Founder and Managing Partner of ILS Capital Management, an investment firm specialising in insurance-linked securities, of which funds under management of, or associated with, participated in the Company’s recent fundraising. Prior to founding ILS Capital, Mr. Libassi was a Managing Director at Strategic Value Partners as well as holding the position of Chairman at Mach Gen LLC. From 2000 to 2007, Mr. Libassi was a Senior Managing Director at GSC Group where he founded the corporate lending group and served as a senior investment professional. Martin Reith has over 30 years’ experience across underwriting, management and leadership. Most recently, he held board positions at Neon Underwriting Limited, as CEO from 2015 to 2019 and then assumed a Non-Executive role until 2020.

Ten Entertainment 244p £167m (TEG.L)

Ten Entertainment Group plc announced the appointment of Adam Bellamy as Non-Executive Chairman effective from the AGM date on 5 May 2021. The Group has conducted a rigorous and wide-ranging selection process to ensure that it appoints the strongest possible candidate to lead the business through its next stage of growth. Adam is currently Senior Independent Director and has served on the TEG Board since 2018 as Audit Committee Chair and latterly Remuneration Committee Chair. His extensive knowledge of our business, as well as his wealth of experience in high-growth consumer-facing companies, make him ideally placed to oversee reopening and a return to growth. Adam is currently a non-executive director at Loungers plc, a fast-growing hospitality operator, and In The Style Group PLC, a high growth e-commerce fashion brand. Adam has previously served as CFO of Pure Gym as well as holding senior finance positions in the hospitality and leisure industry.

Agronomics 25p £125.5m (ANIC.L)

The leading listed company in alternative proteins with a focus on cellular agriculture and cultivated meat, announced portfolio company LegenDairy Foods has rebranded to Formo. Formo’s registration name will remain LegenDairy Foods GmbH. Agronomics co-led Formo’s EUR 4 million seed round in December 2019, alongside M Ventures, the corporate venture capital arm of science and technology company Merck. Agronomics currently holds 6.4% equity interest in Formo on a fully diluted basis. “With the new brand, Formo will bring the future of food to life through science, cheese, and conversation. Formo is the Latin word for ‘I mold, I form’ and the historical origin of the word is closely connected to the tradition of the ancient Romans improving cheese through new technology.”

Kooth 375p £124m (KOO.L)

The provider of digital mental health services has partnered with the Chartered Management Institute to give all CMI members free access to the Kooth digital mental health platform. Kooth is the only digital mental health provider to hold a UK-wide accreditation from the British Association of Counselling and Psychotherapy. Kooth works with employers to support the wellbeing of their employees, providing confidential and anonymous access to counselling, content and self-help tools.

Mirriad Advertising 64.5p £180m (MIRI.L)

Mirriad Advertising plc, the leading in-content advertising company, has qualified to trade on the OTCQX® Best Market in the United States, home to international brands such as Roche, adidas and Heineken . The market is operated by OTC Markets Group Inc. Mirriad commences trading today on the OTCQX under the symbol “MMDDF.”, having previously traded on the OTCQB® Venture Market. Mirriad’s Ordinary Shares will continue to trade on the London Stock Exchange’s AIM market under the symbol “MIRI”.

Spectra Systems 183.5p £81.7m (SPSY.L)

The specialist  in machine-readable high speed banknote authentication, brand protection technologies and gaming security software, has executed an agreement with its central bank customer, in addition to the sensor agreement announced on 2 February 2021, to include a new capability in those sensors to detect “exotic counterfeits”.  The new contract will result in an additional $1.2m of development funding to begin immediately.  This contract increases the total development funding to $8.7MM and could increase the sensor sales revenue by $7.5m to $41.5m, depending on the total order size.

What’s cooking in the IPO kitchen?

Semper Fortis Esports* recently announced its intention to IPO onto the Access Segment of the Aquis Stock Exchange Growth Market.  Semper is a multi-operational Esports organisation focusing on gaming technology solutions, brand enhancement and high growth team infrastructures.  The company plans to raise £2.5m to develop their three core areas of establishing an esports team, forming partnerships with brands for sponsorship and B2B consultancy services.  The Board are highly experienced in sports and corporate deal making (Keith Harris, former Chairman of The Football League), technology and electronic gaming (Nolan Bushnell, founder of the pioneering company, Atari), esports and game tech (Kevin Soltani and Jassem Osseiran) and as FD Max Deeley.  Target Admission Date of 26 April.

Dispersion Holdings PLC, an investor in the high growth FinTech sector within the UK, the USA and Canada, has announced its intention to IPO on the Access Segment of the Aquis Stock Exchange Growth Market.  The Board intends to deploy the majority of the Company’s cash resources in the acquisition of minority interests in a number of different, yet to be identified, companies in the broad FinTech sector, and to apply expertise to the business operations and strategic plans of these companies. Target Admission Date of 30 April.

Darktrace plc. Intends to float on the main market of the London Stock Exchange (premium).  Darktrace was founded in 2013 with a mission to fundamentally transform the ability of organisations to defend their most critical assets in the face of rising cyber threats. Darktrace is a world-leading provider of AI for the enterprise, with the first at-scale in-the-enterprise deployment of AI in cyber security  Due early May.

musicMagpie   is a leader in re-commerce in the UK and US in the circular economy of consumer technology (including smartphones, tablets, consoles and personal computers), books and disc media (including CDs, DVDs and video games).  Expected 28 April. Offer details TBA

Wickes to demerge from Travis Perkins and list on the Main Market. Expected 28 April.

Thor Explorations (TSXV:THX) seeking a secondary listing on AIM. The Company is targeting Admission during Q2 21.   Segun Lawson, President & CEO, stated: “Thor Explorations has advanced significantly, in both project development and capitalisation since the acquisition of Segilola in 2016. This year, the Company is well positioned to achieve two major milestones with the commencement of gold production at Segilola in Nigeria and a maiden resource at Douta in Senegal, as well as continuing to progress our highly prospective Nigerian exploration portfolio on the Ilesha Schist belt.”

Imperial X (AQSE:IMPP) to join the Main Market (standard). It is also proposed that on Admission to the Official List, the Company will change its name to Cloudbreak Discovery Plc.  With effect from Admission, Imperial X will hold equity positions and royalties in a variety of projects in the natural resources sector across multiple jurisdictions, primarily in the Americas and Africa. The Company is proposing to raise up to £1.5m by way of placing of new Ordinary Shares to support further prospect acquisitions. Current Mkt cap £4.7m Expected April.

Proposed move to AIM from the main market (standard)  by Emmerson (EML.L)  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. Due 27 April.

*A corporate client of Hybridan LLP

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