Small Cap Feast

 4th March 2022

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Dish Of The Day:
More Acquisitions (TMOR.L) has joined the Main Market (standard) raising £1.2m. The Company was formed to undertake one or more acquisitions of a majority interest in a company or business. Any such acquisition undertaken by the Company will be treated as a reverse takeover for the purposes of Chapter 5 of the Listing Rules. The directors intend to search initially for acquisition opportunities in the energy transition sector. Energy transition refers to the global energy sector’s shift from fossil-based systems of energy to renewable sources, such as wind and solar and lithium-ion batteries.
Off The Menu:
SEC Newgate has left AIM.

What’s Cooking In The IPO Kitchen?

Cordiant Global Agricultural Income plc intends to float on the Main Market (Premium). The Company’s investment objective will be to seek to provide an attractive yield, with potential capital growth, by providing secured medium-term finance to the global agricultural sector. The Company will seek to promote more sustainable crop production and help address a capital solutions gap which exists in the agricultural sector in select regions. The Company will provide finance for crop inputs and for capital investment in new technologies and infrastructure which help increase crop yields and have a sustainable benefit. Mkt Cap and Capital to be raised TBC.

Majestic Corporation plc, to join AQSE Growth Market. Majestic is a profitable business recycling precious and non-ferrous metals from obsolete mechanical and industrial material including catalytic convertors, printed circuit boards, legacy electrical and electronic equipment, and industrial metal residues left over from manufacturing. The metals extracted for recycling include gold, platinum, rhodium and palladium. The company uses a network of partners to source, acquire, store, and process material and once the waste precious metal is ready it is supplied to refineries, in countries such as Japan, for reconstitution and resupply in to the global supply chain. Due March 2022.

Shellraise plc, to join AQSE Growth Market. The Company will focus on identifying investment opportunities in companies operating in the viticulture sector which require funding to increase output. Mkt Cap and Capital to be raised TBC. Expected 18 March 2022.

Invinity Energy Systems plc, intends to join AQSE Growth Market. The AIM listed Company (IES.L) manufactures flow batteries for large-scale, high-throughput energy storage requirements of business, industry and electrical networks. Due 9 March 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.

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.


Breakfast Buffet

88 Energy Limited 2.4p £381.2m (88E.L)

Update in Project Icewine located on the central North Slope of Alaska. Light oil recovered at Talitha-A, 2.8 miles north of 88E’s Project Icewine acreage. Preliminary mapping shows highly correlatable reservoir sequences between Talitha and Icewine. Independent prospective resource update for Icewine planned for completion in H1 CY2022.

Accsys Technologies 146p £280m (AXS.L)

Accsys, the fast-growing and eco-friendly company that combines chemistry and technology to create high performance, sustainable wood building products, has concluded a final investment decision to construct and operate a new Accoya® production facility in the USA. All key commercial agreements, including bank loans totalling US$80m, are now in place. Construction preparations have commenced, and workers are due to start site mobilisation in the coming days for Accoya USA, LLC, the previously announced joint venture of Accsys and Eastman.

Borders & Southern 1.5p £7.26m (BOR.L)

The London-based independent oil and gas exploration company announced its intention to undertake a fundraising of c. $600k by subscription and up to $1.2m by open offer at an issue price of 1.3p. The Chairman, Harry Dobson, is the sole participant in the Subscription. The net proceeds of the Fundraising will be used to enable the Company to continue to explore the best options to appraise and develop its Darwin gas/condensate discovery, as well as for general working capital purposes.

Blue Rock Diamonds 45.5p £6.4m (BRD.L)

The diamond producer, which owns and operates the Kareevlei Diamond Mine in the Kimberley region of South Africa, announced that four gem quality stones were sold in the February tender for a total USD460,000. Notably, the average tender price of the total parcel of USD638 per carat was significantly above the 2021 average of USD465 and follows on the back of the strong January 2022 tender, which had an average price of USD565. Mike Houston, Executive Chairman said, “As with the January tender, we are seeing a very high demand for Kareevlei’s diamonds, and I believe this is the first time we have seen four diamonds selling for an average of over a USD100k per stone in a single parcel. The exceptional average price per carat for the total parcel of USD638 marked a 37% jump compared to 2021 and is reflective of the strong retail market conditions and a tightening rough diamond supply of high-quality diamonds such as Kareevlei’s. The current geopolitical environment could create further shortages of rough diamonds.”

Chill Brands Group 5.124p £10.9m (CHLL.L)

The international consumer packaged goods company, provides an update on its trading as it approaches its financial year end on 31 March 2022. As previously announced, the Company has experienced significant logistical issues common with other organisations around the world. Since the start of the new calendar year, the Company has successfully eliminated many of these issues by establishing a new distribution and fulfilment arrangement in the USA as announced on 9 February 2022. The Company’s supply chain was also affected by geopolitical issues during the course of the current financial year, in some cases causing delays to the delivery of orders placed by Chill Brands’ distribution partners. As announced in the Company’s interim report published 28 January 2022, Chill Brands’ recognised revenues of over US$1.2m for the first half of this financial year. As a result of supply chain delays, previously announced additional orders valued at approximately US$1m may not all become recognisable revenue by the end of the current financial year. The Chill Brands’ Board is confident that any remaining orders will be placed with distribution and retail partners during the first half of the next financial year. As a result of the disruption to its supply chain, Chill Brands is actively seeking to onshore the manufacturing of its products through the establishment of a North American strategic partnership. The Company looks forward to updating the market in due course.

Malvern International 0.13p £2.7m (MLVN.L)

The global learning and skills development partner, is today issuing an update in respect of current trading and its year ended 31 December 2021. While the longer term industry fundamentals remain strong, unsurprisingly the dynamic situation around international travel throughout last year continued to affect the Company’s performance into the second half of 2021. Revenues in the second half were as expected lower than the first half and costs were higher as MLVN chose to invest and further strengthen its sales and marketing capability, with two sales staff recruited in China and the development of our Mandarin website hosted in China. The preliminary unaudited assessment of the Group’s trading for the full year indicates revenues of circa £2.4m (FY20 £1.9m) and a loss for the year of circa £1m (FY20 £1.33m). Unaudited Net debt as at 31 December was £5.8m. The Company announced separately this morning the successful renegotiation of its existing debt facility. The number of ELT students across its sites in Manchester, London and Brighton grew back to approximately 80% of 2019 levels in Q4 2021.

Oncimmune 131p £90.6m (ONC.L)

The leading global immunodiagnostics group, today announces the signing of a commercial contract with a new top 10 global pharmaceutical company by revenue, initially focusing on the autoantibody profiling of Chronic Inflammatory Demyelinating Polyradiculoneuropathy (CIDP). Under the terms of this new contract, Oncimmune will utilise its specific high-throughput proprietary biomarker discovery platform, SeroTagTM, to identify autoantibodies related to CIDP. Specifically, ImmunoINSIGHTS will produce and validate CIDP specific antigens utilising the SeroTagTM platform to screen clinical samples from CIDP patients for related autoantibodies. CIDP is a rare type of autoimmune disease which attacks the myelin sheaths, the fatty coverings intended to insulate and protect nerves. Often referred to as Guillain-Barré syndrome in its acute phase, CIDP is chronic, difficult to diagnose and can lead to permanent physical impairment if not treated in its earliest stages.

Phoenix Global Resources 4p £111.4m (PGR.L)

Update on drilling activity at various licences. Mata Mora: The Company has commenced the drilling activity for Pad 2, which consists of three wells with 2,600 metre horizontal lateral lengths and 37 frac stages. The Company finished drilling three vertical sections, to depths of 2,314 metres, 2,280 metres and 2,316 metres and two horizontal branches navigating the Vaca Muerta formation, whilst the third lateral section is currently being drilled and will then commence completion activities. Planning to commence the Pad 3 program by mid-March 2022. Corralera South: Completed drilling of a vertical exploration well to a depth of 3,639 metres and its horizontal branch with a 2,134 metre lateral length and 30 frac stages, navigating the Vaca Muerta formation. The well is currently under flow back testing and is producing high volumes of water with oil traces with a high presence of CO₂. Corralera North-East: The Company has finished the drilling of a vertical exploration well to a depth of 2,970 metres and its horizontal branch with a 2,000 metre lateral length and 29 frac stages, navigating the Vaca Muerta formation. The initial flow back testing has been completed, which produced high volumes of water and low volumes of oil with a high presence of CO₂. The well is currently shut in for well testing. Rio Atuel: The Company has executed the drilling and completion activities of a conventional vertical exploration well. The well was drilled to a depth of 2,131 metres penetrating the Huitrin and Chachao formations. After stimulating the well, oil in the two formations has been tested. Initial flow rates are in-line with expectations with a low water cut.

Supply@ME Capital 0.0825p £20.2m (SYME.L)

Supply@ME Capital plc, the innovative fintech platform which provides the Inventory Monetisation© service to manufacturing and trading companies, announces that James Coyle, Non-Executive Chairman, has tendered his resignation as a Director of the Company. Mr Coyle is leaving the company for personal reasons, which will allow him to better balance existing time obligations across his extensive portfolio of non-executive roles. The Board has acknowledged Mr Coyle’s personal reasons and has agreed with Mr Coyle that his departure will take place with immediate effect. The Board is now actively seeking a permanent, long-term successor to Mr Coyle. In the interim period, until a permanent successor is in situ, the Board will appoint one of its existing non-executive directors to chair future Board and Regulatory meetings. Additionally, the Company has appointed an independent adviser to complete a strategic review of the Company, as it prepares for the next phase of growth, which will focus upon the delivery of its long-term business objectives, and its governance system requirements. Upon completion of the Adviser’s review, the Adviser will make recommendations on any additional expertise and capabilities required to ensure Supply@ME is positioned to realise its planned global growth and diversification of revenue streams.

Ten Lifestyle Group 75p £62.8m (TENG.L)

The technology-enabled, global concierge platform for the world’s wealthy and mass affluent provides a trading update. Net Revenue for FY22 remains in line with the Board’s expectations, with the negative effects of Omicron in the second half of H1 expected to be mitigated by new wins launching in H2 and recovery on existing contracts as the pandemic eases in each region. During a period of strong recovery in the Autumn, additional staff were hired. However, the impact of Omicron has resulted in reduced member requests since December. The Group has retained this additional headcount to support new contract launches and the expected recovery of existing contracts. The Board now expects the Adjusted EBITDA outturn for FY22 to be below expectations but with growth still expected on the prior year (FY21: £4.4m). The Group has started to see an increase in activity again in February 2022 in EMEA, where Omicron first impacted in late November. The Board expects the new contract wins secured during H1 to increase revenue and profitability in line with its expectations for FY23, which remain unchanged. The Group continue to enjoy a healthy pipeline of new business and high conversion rates.

4 March 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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In the United Kingdom, this document is directed at and is for distribution only to persons who (i) fall within article 19(5) (persons who have professional experience in matters relating to investments) or article 49(2) (a) to (d) (high net worth companies, unincorporated associations, etc.) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (SI 2005/1529) (as amended) or (ii) persons who are each a professional client or eligible counterparty (as those terms are defined in the Financial Conduct Authority’s Conduct of Business Sourcebook) of Hybridan LLP (all such persons referred to in (i) and (ii) together being referred to as relevant persons). This document must not be acted on or relied up on by persons who are not relevant persons. For the purposes of clarity, this document is not intended for and should not be relied upon by any person who would be classified as a retail client under the Financial Conduct Authority’s Conduct of Business Sourcebook.

Neither this document, nor any copy of part thereof may be distributed in any other jurisdictions where its distribution may be restricted by law and persons into whose possession this document comes should inform themselves about, and observe, any such restrictions. Distribution of this report in any such other jurisdictions may constitute a violation of territorial and/or extra-territorial securities laws, whether in the United Kingdom, the United States or any other jurisdiction in any part of the world.

Where possible this document is made available to all relevant recipients at the same time. Dissemination of research by Hybridan LLP is monitored to ensure that it is only provided to relevant persons. Research prepared by Hybridan LLP is not intended to be received and/or used by any person who is a retail client.

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