Small Cap Feast

Small Cap Feast – 31 January 2020

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Dish of the Day:

No Joiners Today


Off the Menu:

Leaf Clean Energy has left AIM  pursuant to rule 15.


Dish of the Day:

Off the Menu:

What’s Cooking in the IPO Kitchen?


Intention to float by Gemfields Group. No Capital Raise. Currently listed on JSE. (GML:JNB) at circa £122m.  The Group’s key producing assets, the Kagem emerald mine in Zambia  (believed to be the world’s single largest producing emerald mine) and the Montepuez ruby mine in Mozambique (one of the most significant recently discovered ruby deposits in the world), are both expected to have long mine-lives with potential for expansion. Also owns the  Faberge brand. Due Valentines Day 2020.

Main Market (Standard List)

The Proof Of Trust has announced its intention to list on the Standard Market.  The Blockchain based business, owns patents to a protocol which facilitates dispute resolution based upon smart contract disputes.  Transaction details TBC.

Main Market (Premium)

Cabot Square—Closed ended investment fund focussed on alternative assets and asset manager. Looking to raise £200m.  Will target investment opportunities that are expected to generate an attractive risk adjusted return and that can also make a positive ESG impact by focusing on some of the biggest challenges facing societies and economies.  Due 14 Feb.

Calisen Group. Potential Intention to Float. Owner and manager of essential energy infrastructure assets through its subsidiaries Calvin Capital and Lowri Beck . Consolidated FY Dec 18 revenue £162.1m and operating profit £25.4m. Raising up to £300m in primary plus partial vendor sale.  Expected Admission February 2020

The Global Sustainable Farmland Income Trust will invest in a diversified portfolio of operational farmland assets located in major agricultural markets including the United States, Europe, New Zealand, Australia and certain countries within Latin and South America. Raising up to $300m.   Due 28 February.

Investment firm Nippon Active Value fund is seeking to raise up to £200m at an issue price of 100p per share via an IPO.   The company aims to invest in a portfolio of quoted Japanese stocks with market capitalisations of up to $1bn.   First day of dealings expected early February.

Nex Exchange

Zapp Scooters, a developer and manufacturer of electric two-wheeled vehicles announced its intention to IPO on the NEX Exchange Growth Market.  The Company intends to raise up to £3.5 million. Admission is expected to occur on NEX in February 2020.


Breakfast Buffet

Formation Group (NEX:FRM) 4p £7m

FY Aug 19 results from the provider of professional construction management services to its clients in the property sector. Turnover £35.5m from £39.8m. PBT of  £1.3m vs £0.3m loss including £1.3m gain on financial assets.

The Group spent much of the year completing existing projects, and revenues have decreased this year from GBP39.789m in 2018 to GBP35.526m in 2019.  The Group has an Operating loss before fair value changes for the year of GBP0.009m (2018: GBP0.734m).

Every effort is being made to source further development and investment opportunities and the Group is continuing to seek out new opportunities. Notable progress in the year included the Group being appointed as contractor for a residential led scheme in North London.

In June 2019 the Group raised GBP10m in additional share capital and this has now been invested into Irish development projects.


Sativa Group (NEX:SATI) 4p £22.8m

Sativa Group Plc’s subsidiary Goodbody Botanicals has secured a product listing agreement with Alliance Healthcare, one of the leading distributors % wholesalers of pharmaceutical, medical and healthcare products in the UK and Europe. This gives Alliance’s 10,000+ high street retailer customers access to the Goodbody Botanicals range of market-leading CBD products. Alliance Healthcare services independent pharmacies, national accounts, and superstores.

In addition, Alliance’s syndicated pharmacy salesforce, Skills in Healthcare, has been contracted to promote and sell the Goodbody Botanicals range to the 1,500 top performing independent pharmacy customers. Sativa Chief Executive Henry Lees-Buckley said: “The Alliance distribution agreement is a significant step in Sativa’s Goodbody Botanicals CBD Wellness brand’s objective to grow market share with high street pharmacies, grocers, and superstores.”


Metal Tiger (MTR.L) 1.3p £19.8m

Update for Cobre Limited, the Australian Securities Exchange listed copper exploration company focussed on exploring the Perrinvale Copper Project, which consists of prospective high-grade volcanogenic massive sulphide (“VMS”) targets, in central Western Australia. Cobre holds an 80% interest in Perrinvale.

Shares in Cobre commenced trading on the ASX at 11:00am Australian Eastern Daylight Time, on 31 January 2020, following the completion of its oversubscribed A$10m IPO. Metal Tiger subscribed for a total of A$2.4m as part of the IPO fundraise and, accordingly, is interested in 19.99% of Cobre. Cobre has reported it has received the necessary drilling programme approvals from the Western Australian Department of Mines Industry Resources and Safety. The new exploration approvals allow for 162 diamond core, 187 reverse circulation, and 40 aircore holes to be drilled across the 10 targets identified to date. Drilling is expected to commence during February.


MC Mining (MCM.L) 27.5p £38.7m

After seven and a half years at the Company, David Brown will step down as Chief Executive Officer  and Executive Director with effect from 31 January 2020 to pursue his own interests. David will continue to be available until 31 March 2020 for any handover and to assist the Board in any relevant matters.


Brenda Berlin, the Company’s Chief Financial Officer (“CFO”) will now serve as Acting CEO with a focus on securing the required funding for the development of our flagship Makhado hard coking coal project (“Makhado Project” or “Makhado”). The process to raise the $52m composite debt/ equity funding necessary for Makhado Phase 1 is progressing and the Company secured debt funding of $17m from the Industrial Development Corporation of South Africa Limited during H2 CY2019.


Rockfire Resources (ROCK.L) 1.175p £7.4m

Silver up to two ounces/tonne returned at Plateau. Silver (Ag) grades determined by portable X-Ray Flourescence (XRF) analysis of the October 2019 drill samples has identified significant silver at the 100%-owned Plateau gold deposit in North Queensland, Australia.

  • All drill holes returned significant silver assays;
  • The silver credits add potential to the future economics of Plateau including;
  • 187 m @ 6.3 g/t Ag (from 15 m), including 11 m @ 32.6 g/t Ag (hole BPL025) 
  • 10 m @ 18.2 g/t Ag (from 56 m), including 4 m @ 35.4 g/t Ag (hole BPL012) 
  • 36 m @ 5.5 g/t Ag (from 1 m), including 3 m @ 18.8 g/t Ag (hole BPL013)
  • 22 m @ 9.8 g/t Ag (from 0 m), including 8 m @ 18.0 g/t Ag (hole BPL018) 
  • 8 m @ 36.0 g/t Ag (from 66 m), including 4 m @ 63.3 g/t Ag (hole BPL019) 
  • 31 m @ 9.7 g/t Ag (from 29 m), including 10 m @ 19.7 g/t Ag (hole BPL020)


Walcom (WALG.L) 0.3p £0.2m

 Walcom  has received a number of orders during January 2020 which has enabled it to repay the two bank loans totalling RMB 450,000 (c.HK$508,000) that were due for repayment before the end of this month. Following repayment of these loans, the Company currently has adequate working capital to meet its liabilities as they fall due until mid-February 2020.

In its announcement dated 13 January 2020, the Company indicated that Mr Chi intends to provide a loan of HK$1,230,000 to Walcom Bio-Chemicals Industrial Limited, Walcom’s wholly owned subsidiary, by the end of January 2020 (the “Loan Agreement”). The Loan Agreement has not yet been entered into, but the Company remains in discussions with Mr Chi regarding the provision of the proposed funding. Whilst the Board remains confident that the discussions with Mr Chi will have a successful outcome, there can be no guarantee that the Company’s working capital position will be stabilised.


Open Orphan (ORPH.L) 6.05p £26.96m

The rapidly growing specialist pharmaceutical services company which has a focus on orphan drugs, with reference to its announcement of 20 January 2020, announced a fundraising to raise a minimum of £5m before expenses via a conditional placing of new Ordinary Shares  at a price of 6.1 pence per new Ordinary Share to institutional and other investors and a subscription of new Ordinary Shares at the Issue Price to institutional and other investors. The Placing is to be conducted by way of an accelerated bookbuild process.  The Company has conditionally raised approximately £1.0m (before expenses) through the Subscription. The proceeds of the Fundraising receivable by the Group will be used to fund the growth and synergies programme of the Group following completion of the Merger of Open Orphan and hVIVO.

The Issue Price represents a premium of approximately 0.8%. to yesterday’s close. The Fundraising has been underwritten up to £2.5m by Raglan Capital Limited, an entity controlled by Cathal Friel. Cathal Friel also intends to participate in the Placing.


Ultimate Sports Group (USG.L) 27.5p £9.8m

Since Matthew Farnum-Schneider’s appointment as Chief Executive, the Group has been assessing a number of investment opportunities in high growth markets. The Group is today announcing that it is in advanced discussions in relation to a potential investment into an artificial intelligence company which provides machine learning solutions to asset managers and other financial services companies.  These discussions are currently on a non-binding basis and there is no guarantee they will result in a transaction. The Group will provide further updates as and when appropriate.

To reflect the new strategic focus, the Group is proposing to change its name to Catena Group PLC.


M&C Saatchi SAA.L 100.75p £93.8m

The Financial Conduct Authority (“FCA”) has notified M&C Saatchi plc that it has commenced an investigation following the accounting adjustments announced by the Company, most recently on 4 December 2019, and following the completion of an independent forensic review commissioned by the Board. The Company will co-operate fully with the FCA.



Frontier IP (FIPP.L) 67p £33.96m

The specialist in commercialising university intellectual property, is notes that  portfolio company Exscientia, a world leader in AI-driven drug discovery, has announced the first AI-created drug to enter clinical trials in a joint development with Sumitomo Dainippon Pharma. A phase I clinical study of the drug candidate DSP-1181, designed to treat obsessive-compulsive disorder as an initial indication, has started in Japan. Exscientia’s other partnerships include collaborations with Bayer AG, Celgene, Sanofi, GT Apeiron, Rallybio and Evotec. Frontier IP currently holds a 3.25 per cent stake in the Company.


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Derren Nathan
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