Small Cap Feast

28th February 2022

Dish of the day
No Joiners today
Off the menu
No leavers today
Dish Of The Day:
ASX Listed Neometals Ltd (NMT.L) has joined AIM. Neometals innovatively develops opportunities in minerals and advanced materials essential for a sustainable future. The Company has four key battery materials projects that support the global transition to more circular supply chains and cleaner energy. Mkt Cap is expected to be approximately AU$716m. No capital raised.
Off The Menu:
No Leavers Today.

What’s Cooking In The IPO Kitchen?

URA Holdings, a London based mining exploration and development company, intends to list on the Main Market (Standard). URA, a former AIM-listed company, is refinanced and ready for listing as an African focused mineral exploration company. The Company’s purpose is to seek unique, value-enhancing opportunities in minerals as a project generator including to prove-up early-stage exploration projects to spin out/farm out or sell. The strategy is initially focussed on Southern and Central Africa, and good opportunities will occur in countries with relatively stable and reliable political system such as Zambia. The Company has raised £1.05m before costs. The net proceeds of the Placing will be primarily applied for the development of the Group’s Njoka project and working capital. Admission is expected week commencing 21st February 2022.

Cleantech Lithium intends to join AIM. The Group is intending to produce lithium using a sustainable direct lithium extraction method, which returns water to its source instead of depleting vital aquifers. Each of the Projects are based in Chile, one of the world’s best regions for solar and other renewable energy. The intention is to utilise renewable energy for process power. The result being that the overall process will have a very low CO2 footprint potentially giving a critical advantage in the European Union market which has set strict CO2 emissions limits. Mkt Cap and Capital to be raised TBC. Due 14 March 2022.

GCP Co-Living REIT plc, intends to float on the Main Market. The Company is a newly established, externally managed investment company, which it is intended will carry on business as a Real Estate Investment Trust, subject to meeting the necessary qualifying conditions. The Company will invest, predominantly, in independent Co-Living Asset, both operational and under development, let to a diversified mix of residents, located in urban centres in the UK and Ireland where there is a shortage of high quality, affordable residential accommodation. Due March 2022.

Spinnaker Acquisitions plc, intends to join the Main Market (Standard). The Company have conditionally agreed to acquire the entire issued share capital of HomeServe Labs Ltd, a wholly owned subsidiary of FTSE250 quoted public company HomeServe Plc, by way of a reverse takeover conditional, inter alia on relisting and successful completion of fundraising activities to be undertaken by way of a placing and direct subscriptions by new and existing investor. If the Proposed Transaction proceeds to completion, it is proposed to change the name of the Company to Ondo InsurTech Plc and the name of Labs, which will become a subsidiary of the Company, to LeakBot Ltd. Should the Proposed Transaction not proceed, then the Company would need to apply for the suspension of its listing of ordinary shares to be lifted and for trading to be restored. £5m capital to be raised. Due early 2022.

Carbon Air, a nano-technology company which leverages the adsorption properties of activated carbon and other advanced materials to improve suspension systems, enhance acoustics or reduce noise, to join AIM. The Company’s proprietary technology has allowed it to develop a unique portfolio of solutions for a variety of sizeable end markets, including vehicle suspension systems, acoustic insulation for domestic appliances and micro-speakers for smartphones. Mkt Cap and Capital to be raised TBC. Due Late March.

Spiritus Mundi due to join the Main Market (Standard), a special purpose acquisition vehicle which will seek acquisition targets in Europe and Asia in the clinical diagnostics sector. The Company has already raised approximately £1.2m in a pre-IPO fundraising round. Delayed until second half of Q1 2022.

Recycling Tech Group to join AIM, a UK-based engineering, research and manufacturing company that has developed a modular and mass producible machine, the RT7000, which processes hard to recycle plastic waste into a synthetic oil that can be sold back to the petrochemicals industry as a chemical feedstock to make new plastics. Targeting a £40m raise. Due early March 2022.

Nu-Oil and Gas to acquire Guardian Maritime Ltd and Guardian Barriers IP Ltd and become Guardian Global Security plc and join the Main Market (Standard). Guardian is a technology group that supplies products to prevent unauthorised entry into areas that are deemed to have value, with maritime security being the main focus initially. Due Feb.


Breakfast Buffet

Chariot 8.88p £70.4m (CHAR.L)

The Africa focused transitional energy company has been formally awarded the Rissana Offshore Licence in Morocco. 75% interest and operatorship of the Rissana licence awarded to a wholly owned subsidiary of Chariot Limited in partnership with the Office National des Hydrocarbures et des Mines which will hold a 25% interest. Rissana (approximate area 8,489 km2) surrounds the offshore area of Chariot’s existing Lixus Offshore Licence, where the Company, in January 2022, announced the conclusion of successful drilling operations at the Anchois field, including significant new gas discoveries. Provides material additional potential running room on-trend with the Anchois gas discovery and reinstates the highest potential areas of the former Mohammedia Offshore area into Chariot’s portfolio. Initial minimum licence commitment is the acquisition of a 2D seismic survey, which will help to evaluate the extension and potential of these gas plays across Rissana.

Coro Energy 0.34p £7.1m (CORO.L)

The Company signed a conditional share purchase agreement with Dubai Energy Partners, Inc (DEPI), an international oil and gas company focused on the acquisition of producing assets, in respect of the disposal by the Company of its Italian portfolio to DEPI. This SPA was conditional on, inter alia, the receipt of required regulatory approvals from the Italian authorities being received by 26 February 2022. These regulatory approvals have not been received and, in accordance with the SPA, Coro has served a notice of non-fulfilment on DEPI and in doing so has commenced, as prescribed by the SPA, a 5 business day good faith consultation period between the Company and DEPI in order to determine whether completion of the disposal can be achieved. The Company remains conscious of recent positive developments in global gas prices since May 2021 and the resulting significant increase in the implied net asset value of its Italian portfolio.

Infrastructure India 0.775p £5.3m (IIP.L)

The infrastructure fund investing directly into assets in India, announced that an agreement has been signed for the conditional sale of Indian Energy (Mauritius) Limited’s (IEL) assets. IEL, which is a wholly owned subsidiary of IIP, is an independent power producer that owns and operates wind farms at two sites in the states of Karnataka and Tamil Nadu, with 41.3MW of installed capacity. IEL holds each wind farm asset within separate Special Purpose Vehicles, Theni and Gadag, which are its only assets. IIP has entered into an agreement for the conditional sale of its 100% interest in each SPV to AVSR Constructions, which develops, operates and maintains renewable energy projects in India. The total consideration to be received by IEL from AVSR for both assets is INR 550m (approximately £5.45m) and the transaction is structured with the separate sale of each SPV.

Made Tech Group 61p £94m (MTEC.L)

Made Tech Group plc, a leading provider of digital, data and technology services to the UK public sector, announced that a consortium including Made Tech has been awarded a two-year contract worth up to £37.5m with the Health and Social Care Information Centre. The contract has been awarded through the NHS Digital Capability framework and will be delivered jointly by Made Tech and its consortium partner Answer Digital, with Made Tech expected to receive approximately half of the total contract value. Delivery under the contract has already commenced. The contract significantly enhances revenue visibility for Made Tech in FY23 and FY24. The award is in line with the Group’s stated strategy outlined at the time of IPO to increase Made Tech’s presence in the Health & Social Care market.

Mission Group 60.5p £55.1m (TMG.L)

The creator of Work That Counts comprising a network of 16 Agencies delivering real, sustainable growth for its Clients, today announces the acquisition of Livity ltd, the youth focused creative business for a consideration of £0.1m, to be satisfied in cash. Based in Brixton, South London but working globally for its clients, Livity is the market leader in its space with over 20 years’ experience. It works with leading brands to help them understand youth culture and enable them to engage with the next generation with purpose. Its Clients include Nike, Google, Footlocker, YouTube, NPSCC Childline, Dr. Martens and more. The acquisition will enhance MISSION’s brand, strategy, creative and content capabilities, underpinning the Generation Z marketing offering across the Group. Livity also provides a new route to next generation talent for the MISSION. Diverse by design, Livity’s innovative talent strategy is focused on young people and developing potential based on their skills and interests. In the financial year ended 31 December 2020, Livity reported a gross profit of £1.1m, pre-tax losses of £0.4m and as at 31 December 2020 had net liabilities of £ 0.6m.

Oncimmune 110p £79.5m (ONC.L)

The global immunodiagnostics group, today announces the signing of a new commercial contract with Verily Life Sciences LLC, an Alphabet company (parent company to Google), focusing on the autoantibody profiling of patients who have had the COVID-19 infection and have gone on to develop long lasting symptoms lasting more than four weeks (Long COVID) also known as post-acute sequelae SARS-CoV-2 infection (PASC). Under the terms of this new contract, Oncimmune will utilise its recently validated infectious disease panel of biomarkers, developed under the IMmunity Profiling of pAtients with COVID-19 for Therapy and Triage (IMPACTT) programme, to evaluate whether autoantibodies, which are present early in the COVID-19 infection, are associated with the development of Long COVID. Furthermore, the Company’s infectious disease panel will also be used to assess whether these autoantibodies remain elevated in Long COVID patients during their period of recovery. Should this initial discovery phase prove successful, both Oncimmune and Verily have retained the rights to commercialise the resultant intellectual property, including the filing of patent applications for the development of a companion diagnostic.

OnTheMarket 92.5p £69m (OTMP.L)

The majority agent-owned company which operates the OnTheMarket.com property portal, updated on trading for the year to 31 January 2022 (FY22). Strong performance in line with recent update. The Group’s operational performance continued to be strong throughout the second half of FY22 and in its trading update on 21 January 2022, OnTheMarket upgraded its expected adjusted operating profit for the year to 31 January 2022 to be not less than £2.5m. Following the end of FY22, the Group confirms that full year results were in line with these increased expectations. Accordingly, subject to audit, the Group expects to report for FY22: Revenues of approximately £30.8m (FY21: £23.0m); and adjusted operating profit for the year of approximately £2.6m (FY21: £2.4m).

Safestyle UK 43.2p £59.9m (SFE.L)

Further to the announcement on 28 January 2022 regarding a cyber incident, the Group is now able to provide an update on the recovery process and impact on trading. The incident occurred on 25 January 2022 and was a highly sophisticated attack the Company was advised emanated from Russia. The impact of the attack was mitigated by recent investments to modernise the IT infrastructure. Further, through effective business continuity actions, the business has been able to continue to sell, survey, manufacture and install since the attack. Safestyle’s sales momentum, supported by a return to TV advertising on 14 February, has remained strong and the order book has continued to build. The balance sheet, liquidity and net cash positions remain healthy and are comparable to those levels previously communicated at the end of 2021 (net cash is currently over £12m).

Strix Group 242p £501.2m (KETL.L)

The global leader in the design, manufacture and supply of kettle safety controls and other complementary water temperature management components, reports that it has recently been the subject of a cyber incident of Russian origin in its business. On becoming aware of the incident, which mainly impacted Strix’s Isle of Man and UK servers, the Group immediately engaged external specialists and took precautionary measures with its IT infrastructure, including taking its systems offline whilst it investigated the nature and extent of the incident and implemented its business continuity plan. These systems are now restored and fully operational. There has been no impact on customer orders or sales, with all businesses within the Group remaining operational. The Company has also appointed cyber security experts to continue to monitor and support the Group with this incident as well as report on the attack and make recommendations to further enhance and refine the Group’s processes and procedures. These recommendations will be implemented. The Group is fully aware of its obligations and is working with its professional advisers, the police and relevant regulatory authorities and will provide further updates as and when appropriate.

Summerway Capital 132.5p £10.6m (SWC.L)

Restoration of trading and publication of admission document. Further to its announcement on 28 October 2021, the Company advised that it has conditionally raised £8.5m (before expenses) by way of a placing and subscription to certain institutional and other investors at 165 pence per Summerway share. The proceeds of the Fundraising will be used to fund the Enlarged Group’s working capital requirements following completion of the proposed Acquisition. Vertigrow is one of the first pharmaceutical companies in the UK to receive a Home Office licence, following approval from the MHRA to apply for the licence, to grow high tetrahydrocannabinol cannabis, which is expected to be used in medicinal products, initially focusing on the chronic pain market. Operates within a highly regulated market with substantial growth potential, benefiting from positive tailwinds and strong regulatory and operational barriers to entry. At full capacity, Vertigrow’s current facility could supply up to 50k patients, which has the potential to generate revenue of £90m per annum with EBITDA margins of approximately 50 per cent. Provides Summerway with a compelling foundation from which accretive and complementary M&A opportunities could be executed alongside Vertigrow’s existing organic growth initiatives. £80m consideration, payable through the issue of approximately £48.5m Ordinary Shares at 165 pence per Summerway share. £8.5m conditionally raised (before expenses) to provide additional working capital for the Enlarged Group.

28 February 2022
*A corporate client of Hybridan LLP

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The content of this document includes market commentary and other information which we have prepared in relation to the company referred to in this document, which is our broking client. The provision of this document to you constitutes a minor non-monetary benefit which is capable of enhancing the quality of service provided by Hybridan LLP and which is of a scale and nature which could not be judged to impair the duty of Hybridan LLP to act in the best interest of its client falling within article 24(7)(b) of Regulation 600/2014/EU (MIFID II Regulation).

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