Small Cap Feast

Small Cap Feast – 02 January 2019

Dish of the Day:

PetroTal Corp an oil and gas company whose shares are currently admitted to trading on the TSXV, joined AIM on 24 Dec 2018. Mkt cap c.£80m

Off the Menu:

Randgold Resources has cancelled its listing after merging with Barrick Gold Corporation

Amedeo Resources has cancelled its quote on AIM on 31 December 2018

Harvey Nash group has cancelled its quote on AIM on 28 December 2018

URA Holdings has cancelled its quote on AIM on 24 December 2018

What’s Cooking in the IPO Kitchen?

Main Market (Specialist Funds)

The Global Sustainability Trust -aiming for attractive risk-adjusted returns by investing primarily in private market investments that are expected to have a positive environmental and social impact raising c.£200m. Due 31 Jan 2019.


Greenfields Petroleum (TSX-V:GNF)  production focused company with operated assets in Azerbaijan seeking AIM dual listing including $60m private placement. Mkt cap $12.6m CAD. Expected late January 2019.

Breakfast Buffet

TMT Investments* (TMT.L) 2.21p £50.64m

TMT Investments, the venture capital company investing in high-growth technology companies, announced that it has agreed to dispose of its entire holding in Wrike, Inc. for a net aggregate cash consideration of US$22.9m. The Disposal will result in a substantial increase in the Company’s cash resources and its NAV.

The Disposal represents a substantial uplift in the valuation of TMT’s investment in Wrike of approximately $14.5m and will, on receipt of funds, result in a material increase in the Company’s available cash to over $25m.

The Company has also taken the prudent decision to impair its investment in Wanelo, Inc. by approximately $3.5m.

Despite the impairment of Wanelo, the Disposal will result in a significant increase in the Company’s NAV of approximately $11m, equivalent to approximately 37.5 cents per share. This represents a material uplift in the Company’s NAV of approximately 13.7% from the previously stated figure of $2.75 per share as of 30 June 2018.


Faroe Petroleum (FPM.L) 146.4p £548.1m

Faroe Petroleum, the independent oil and gas company focusing principally on exploration, appraisal and production opportunities in Norway and the UK, announced the results of the Brasse East exploration well 31/7-3 S and the Brasse appraisal sidetrack 31/7-3 A in the northern North Sea.

The Brasse East exploration well 31/7-3 S was drilled to a total depth of 2,247 metres below sea level.  The well targeted a separate structure located to the east of the Brasse field. The well encountered 48 metres of gross Jurassic reservoir with excellent properties, but was found to be water wet. Data acquisition was undertaken including coring and logging.

The Brasse appraisal well 31/7-3 A sidetrack, planned as a further appraisal of the northern part of the Brasse field, was drilled to a total depth of 2,254 metres below sea level. Preliminary analysis of the log data acquired whilst drilling, indicates the well encountered approximately 40 metres of gross hydrocarbon-bearing Jurassic reservoir. Both the reservoir depths and the hydrocarbon contact are similar to the pre-drill expectations. Further wireline logging is ongoing which will be incorporated into the final well results.

Drilling operations are being undertaken using the semi-submersible Transocean Arctic rig. The co-venturer in the Brasse PL 740/PL 740 B/PL 740C licences is Vår Energi AS (50%).


Spectra Systems (SPSY.L) 119p £47.98m

Spectra Systems Corporation, a leader in machine-readable high speed banknote authentication, brand protection technologies, and gaming security software, announced that it has received the first production order for the Company’s patented materials-based smartphone authentication product, TruBrandTM. This first of two expected orders is from Zhejiang Tobacco Company, one of the leading tobacco companies in China. This launch of TruBrandTM, to be incorporated into approximately 6,000,000 -8,000,000 cigarette packs to be sold in China, is aimed at gauging acceptance of the TruBrandTMtechnology and further refining the product for use in potentially billions of units for larger volume brands in the future.

These first orders are specifically for one of the highest value cigarettes brands in China manufactured by Zhejiang Tobacco, the Liquan Yunduan Series, which retails for 120 RMB (US$16.80) per pack. Lower priced brands sell for approximately US$3-US$5 per pack and are typically in the billions of packs annually. Approximately 60% of the price is believed to go to government tariffs.


Richland Resources (RLD.L) 0.13p £0.68m

Richland, the Australian sapphire producer and gemstones developer, announced an extension of its £0.4m Secured Convertible Loan Facility and an update on its strategy in relation to its wholly owned subsidiary, Capricorn Sapphire Pty Ltd, owner of the Capricorn sapphire mine in Queensland, Australia.

The Company has agreed and signed a second addendum to its pre-existing Convertible Loan Facility, to extend the facility’s Maturity Date from 31 Dec 2018 to 28 Feb 2019, for no additional consideration, with all other terms and conditions remaining unaltered. As announced on 28 Sept 2018, the first addendum to the Convertible Loan Facility involved an increase in the principal amount from £0.3m to £0.4m, on the same commercial terms as the original Convertible Loan Facility.

On 28 Sept 2018, the Company announced that it was engaged in discussions with potential strategic investors to procure sufficient funding to enable the recommencement of production at the Capricorn sapphire mine or, alternatively, was seeking to conclude ongoing negotiations with different parties in relation to the potential sale of all or a part of Capricorn Sapphire. The Company is continuing to pursue this stated strategy and remains in discussions with one party, in particular, with regards to the potential sale of the entire Capricorn Sapphire project


Renalytix AI (RENX.L) 122.5p £65.9m

Renalytix AI, a developer of artificial intelligence enabled clinical diagnostics solutions for kidney disease, announces the exercise of its option, as described in the Company’s admission document, for the exclusive license from the Icahn School of Medicine at Mount Sinai (“ISMMS”) of a portfolio of diagnostics (referred to as FractalDX) focused on kidney transplant.  

The portfolio consists of data, development and intellectual property across different diagnostic indications including identification of post-transplant / sub-clinical acute rejection, prediction of fibrosis / graft survival and pre-transplant / immune stratification.

As previously indicated, the terms of the exercise include a $1m upfront exclusive license payment and reimbursement of intellectual property legal and other fees of approximately $0.3m to ISMMS. The license agreement is subject to certain milestone, royalty and maintenance payments as the Company progresses through the process of commercialisation and into product sales.


Amerisur Resources (AMER.L) 16.7p £186.35m

Amerisur Resources, the oil and gas producer and explorer focused on South America provided an operational update regarding the initial short term testing (“STT”) at the Indico-1 well on the CPO-5 block (AMER 30%) and upcoming CPO-5 drilling programme.

STT at the Indico-1 well has flowed 35.9° API oil to surface from the Lower Sands (“LS3″) of the Une formation at a series of choke sizes with a final flow rate of 4,530 barrels of fluid per day (gross) with a water cut of 0.33% at a choke size of 40/64” and a wellhead pressure of 241psi

Initial analysis by the Company indicates that a 283 feet gross, 209 feet net, oil column is present in the LS3 formation at Indico-1

Reservoir pressure data confirms an oil column throughout the LS3 reservoir, with no indication of Oil-Water-Contact (“OWC”)

Indico-1 will continue to be produced under STT while application is made to ANH to begin a Long-Term-Testing (“LTT”) programme on the well


Victoria Oil & Gas (VOG.L) 23.3p £34.41m

Victoria Oil & Gas, the Cameroon based gas and condensate producer and distributor, announced that its wholly owned subsidiary Gaz du Cameroun S.A (“GDC”) has received the Decree signed by H.E President Paul Biya on Dec 17, 2018, authorising the transfer of interest in the Matanda Production Sharing Agreement licence assigned from Glencore in early 2016.

GDC has now secured 75% ownership and is operator of the Matanda PSC, adjacent to its Logbaba concession, which at 1,235 square kilometres Matanda is over 60 times the area of the Logbaba concession

North Matanda offshore field contains gross estimated 2C recoverable gas resources of 150bcf and 6 million barrels of condensate and upside of 1TCF of gas

Onshore prospects close to Logbaba gas pipeline network will be the focus, where resources of Gross Prospective Mean GIIP are estimated at 1303bcf of gas contained in 23 prospects and leads

Existing GDC infrastructure with close proximity to Matanda will allow new discoveries to be delivered to industrial users efficiently and promptly

A minimum work programme obligation of one exploration well plus seismic reprocessing to be completed in the first 2 years of the assignment following the Presidential Decree.


Windar Photonics (WPHO.L) 85p £37.8m

Windar Photonics, the technology group that has developed a cost efficient and innovative LIDAR wind sensor for use on electricity generating wind turbines, announces that the Put / Call option agreement  entered into on 15 March 2016 by Pasinika s.á.r.l, wholly owned by Jørgen Korsgaard Jensen, CEO of the Company and an existing shareholder of O-Net WaveTech Limited, has been extended from 31 Dec 2018 and will now expire on 30 June 2019.


Head Chef:

Derren Nathan
0203 764 2344

*A corporate client of Hybridan LLP


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