Evil Diaries: Logical development

Every now and then an anomaly pops up in the market and stays there for months. Logistics Development Group (LDG) is just this. It has been entirely stripped of all assets bar cash and this comes to 19p per share. There is no debt.

There is a documents trade in hand in that LDG has invested £13.1m awaiting a cash takeover of Caretech Holdings (CTH). But this is a certainty to come through in hard cash plus the profit which will exceed the return by way of interest that would otherwise be achieved.

LDG have appointed an investment manager, DBAY, to deploy the cash. There is no reason to think DBAY will be foolish.

LDG has 702m shares standing at 13.4p which offers a capitalisation of £94m.

LDG has the requisite authority to allow it to buy in its own capital and seemingly is holding back through a phase of weaker markets. To advantage it would seem.

As matters stand the share price can only go up and is therefore a safe bet in the long term for the patient and modest. I bought a further 200,000 this morning at 13.4p.