Small Cap Feast

29th November 2023

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What’s Cooking In The IPO Kitchen?

23 November — Substrate Artificial Intelligence ITF: An artificial intelligence Company based in Spain that creates, buys and scales companies around AI in diverse sectors such as fintech, agritech, energy, human resources, and health announces its Admission to the Aquis Growth Market. Expected Admission date is on or around the 7 December 2023.

15 November: Afentra Plc ITF: Formerly Sterling Energy plc, and launched in 2021 to support the African energy transition as a independent oil and gas company announces its Admission to AIM pursuant to the Sonangol Acquisition which constitutes a reverse takeover and therefore Admission is being sought as a result of such reverse take-over. The Company will not be raising new capital as part of its Admission. Anticipated market capitalisation on Admission will be c.£65m. Expected Admission date is expected mid-December.

9 November: Chapel Down Group ITF:  England's leading and largest wine producer with an award-winning range of sparkling and still wines, under the Chapel Down brand. The Company owns, leases and sources from 1,023 acres of vineyards in South East England announces its Admission to AIM after its transfer from the Aquis Apex market. The Company will not be raising new capital or providing a secondary offering as part of its Admission. Anticipated market capitalisation on Admission will be c.£75m. Expected Admission date is 7 December 2023.

2 October: Tekcapital announced intention to spin off and IPO: MicroSalt, the developer of salt-producing technology designed to deliver full flavor with less sodium, announces the launch of an exempt public offer of shares to retail investors for up to £2.5m via PrimaryBid as part of its spin out from AIM listed Tekcapital plc (TEK.L). Microsalt announced revenues of US$0.638m in 2022, its first year of retail sales of SaltMe Crisp brand and Microsalt salt shakers in US based supermarkets and through Amazon US. AIM Admission delayed, expected mid-November.


Breakfast Buffet

ADM Energy* 0.5p £2.0m (ADME.L)
The natural-resources investing Company announces that in line with its Investing Policy and its announcement of 14 November 2023, it has made a further investment in an energy technology company focused on providing technology solutions to the upstream sector of the U.S. oil and gas business. The acquisition is of approximately a 53.1% economic interest in OFX Technologies, LLC (OFXT) 100% owner of Efficient Oilfield Solutions, LLC. Total Maximum Consideration of US$1.285m is comprised of the issue of new ordinary shares and 3-year warrants and US$235k in cash. The Total Maximum Consideration implies a value of OFXT of approximately US$2.3m or 4.5x the annualised monthly recurring revenue target of OFXT for the end of Q1 2024. A subscription of US$225k of the amended Secured Convertible Loan Notes (as announced on 14 November 2023) and US$10k previously funded by the Company will fully fund the Company's cash commitments associated with the investment.

Aquis Exchange 342p £94.1m (AQX.L)
The creator and facilitator of next-generation financial markets announces that its primary and secondary markets exchange, the Aquis Stock Exchange, has become the first Recognised Investment Exchange (RIE) to run a cloud-based matching engine. Effective from 27 November 2023, all trades on the Aquis Stock Exchange are being matched and executed successfully while running on Amazon Web Services (AWS), which creates a seamless experience with benefits including scalability, resilience, flexibility and cost savings.

Arecor Therapeutics 186p £57.0m (AREC.L)
The biopharmaceutical group advancing today's therapies to enable healthier lives announces that it has signed a further collaboration agreement with Eli Lilly and Company (Lilly). Under the terms, Arecor will use its formulation technology platform, Aresta, to develop a novel liquid formulation of one of Lilly's products with enhanced properties. Lilly will fund the development work and has the option to acquire the rights to the new formulation and newly created IP under a technology licensing model to further develop and commercialise the product.

Arkle Resources 0.45p £2.1m (ARK.L)
The Irish gold and zinc exploration and development Company has completed an initial prospecting programme on its newly acquired Aughrim block of licences. The new block consists of four prospecting licences centered around Aughrim, County Wicklow. The main target is lithium bearing pegmatites which have been located in contiguous ground to the west held by International Lithium Corp - Gengfeng Lithium Co. Ltd. Arkle geologists sampled ten priority target areas that were identified during earlier compilation work. Visual observations by the team identified pegmatites. Fifty-nine samples were collected and have now been received by ALS laboratories who will conduct analysis on them for lithium and other critical metals.

IQE 19.92p £191.5m (IQE.L)
The supplier of compound semiconductor wafer products and advanced material solutions to the global semiconductor industry announces the appointment of Bamdad (Bami) Bastani and Maria Marced, to IQE's Board of Directors as independent Non-Executive Directors. Their appointments will be effective from 1 January 2024, at which time Sir Derek Jones KCB will step down from the Board. Bami Bastani joins with a wealth of experience in the semiconductor industry, having spent seven years at GlobalFoundries. Maria Marced is currently the President of Taiwan Semiconductor Manufacturing Company (TSMC) Europe.

LifeSafe Holdings 17.5p £4.4m (LIFS.L)
A fire safety technology business with fire extinguishing fluids and fire safety products provides a trading update for the eleven months to date (period). Revenues were approximately £5.4m, 62% higher than the same period last year. Owing to increases in costs of digital advertising and logistics particularly in the US, the Group will not attain monthly EBITDA profitability in Q4 2023 as previously anticipated. The Board guides that the FY23 LBITDA will be higher than current market expectations with underlying LBITDA expected at c.£1.3m to £1.5m. The Group is ahead of its strategic plan in the development, testing and pipeline of its next generation of fluids.

Northern Bear* 61.5p £11.5m (NTBR.L)
The holding company of the group of companies providing building and support services headquartered in Northern England and serving customers across the UK, announces unaudited interim results for the Company and its subsidiaries (Group) for the six months to 30 September 2023 (H1 FY24). Revenue of £36.9m represented an increase of 8.7% (H1 FY23: £34.0m), and an operating profit of £1.8m represented an increase of 20.9% (H1 FY23: £1.5m). The profit for the period was up 11.6% to £1.3m (H1 FY23: £1.1m) and the Company holds net cash of £0.4m as at 30 September 2023. Site activity levels remained high despite the ongoing macro-economic challenges and their related impact on the construction industry. The Board confirms that the Group is trading in line with market expectations. The Company also announces the results of the Tender Offer, details of which were set out in the circular published by the Company on 23 October 2023. The total value to be returned to shareholders of the Company pursuant to the Tender Offer will be £3.1m.

Silver Bullet Data Services Group 112.5p £18.0m (SBDS.L)
A provider of digital transformation services and products announces that the Company has raised gross proceeds of £1.0m through a placing of new ordinary shares at a price of 70 pence per share (Placing Price). The Placing Price represents a 27.2% premium to the 6-month VWAP and a 18.4% discount to the 3-month VWAP. The net proceeds of the Placing will be used to provide the working capital required to facilitate the growth in new contract wins and further the expansion of the Company's new 4D AI Powered Insights Platform. Silverbullet’s revenue increased by 79% and overall operating costs reduced by 8% in H1 2023, as the Company moves towards a position of positive EBITDA in early FY24.

Southern Energy Corp 14p £23.7m (SOUC.L)
A producer with natural gas and light oil assets in Mississippi announces its third quarter financial and operating results for the three and nine months ended September 30, 2023. Petroleum and natural gas sales were $5.3m in Q3 2023 and $14.2m for the nine months ended September 30, 2023. The Company generated $1.1m of adjusted funds flow from operations in Q3 2023 and announced a net loss of $2.4m in Q3 2023. Average production in Q3 2023 was 16,881 Mcfe/d (2,814 boe/d) (95% natural gas) and on November 9, 2023, the Company closed an equity financing raising gross proceeds of $5.0m. The Company currently has $10.0m of unused capacity on its Credit Facility, which can be utilised alongside its cash to complete the four drilled uncompleted horizontal wells.

Synectics 105p £18.7m (SNX.L)
A Company focusing on advanced security and surveillance systems announces that it has secured a contract worth £1.0m with a UK financial institution to deliver a multi-site deployment of Synergy, the Company's proprietary software platform (Contract). The Contract, which will be completed in FY 2024, will see Synectics deliver an upgraded surveillance and security system in multiple locations across the financial institution's back-office estate in the UK.

29 November 2023
*A corporate client of Hybridan LLP or retained by Hybridan LLP for certain services
** Arranged by most recent first
*** Alphabetically arranged

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