Small Cap Wrap – IQE, Petards Group, MediaZest and more…

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11 Feb 2021

@HybridanLLP

*A corporate client of Hybridan LLP

 

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What’s cooking in the IPO kitchen?

AMTE Power,  a developer and manufacturer of lithium-ion battery cells for specialist markets, announced its intention to seek admission to trading on AIM. Admission is expected to take place during March 2021. The Company intends to raise approximately £7 million by way of a placing of new ordinary shares in the capital of the Company. Timing TBC.

Samarkand Group Limited, the cross-border eCommerce technology and retail group opening up the world’s largest market for brands and retailers, intends to IPO on  the Apex Segment Aquis Stock Exchange Growth Market. Admission is targeted for March 2021.

Cellular Goods a UK-based provider of premium consumer products based on biosynthetic cannabinoids announced its intention to join the main market (standard) this Spring.   Target valuation £20m raising c. £8m “to finalise the development and launch of a range of the Company’s premium-quality consumer products based on biosynthetic cannabinoids, which is fully compliant under UK law.”

Kanabo Group (RTO by Spinnaker Opportunities SOP.L) on the main market (standard). Raising £6m, enlarged mkt cap £23.4m. Kanabo focuses  on the distribution of Cannabis-derived products for medical patients, and non-THC products for CBD consumers . Due 16 Feb.

NextEnergy Renewables  to launch an IPO on the Main Market. NREN is a differentiated renewables investment company that aims to capture the most attractive private renewables and energy transition infrastructure investment opportunities globally.  Targeting a £300m raise.   NREN is targeting total returns of 9-11 per cent. per annum (net of all fees and expenses but including the Target Dividend and capital appreciation) . The Company’s target dividend yield for the first full financial year to 31 December 2022 is 5.5 pence. Due Early March 2021.

Auction Technology Group is considering an IPO on the Main Market.  The Group operates six world-leading online Marketplaces and proprietary global auction platform technology for curated online auctions .  In FY20 the Group delivered pro forma revenue of £52.3 million, supported by notable underlying year-on-year growth from both Standalone ATG Group and Standalone Proxibid Group (12.4 per cent. and 40.4 per cent., respectively). For the same period, the Group delivered a strong profitability performance of £22.3 million pro forma Adjusted EBITDA representing a pro forma Adjusted EBITDA margin of 42.6 per cent. Expected March 2021.

Digital 9 Infrastructure launch an initial public offering  on the Specialist Fund Segment of the Main Market of the London Stock Exchange, by way of an initial placing and offer for subscription for a target issue £400m. Digital 9 Infrastructure plc is a newly established, externally managed investment trust. The Company will invest in a range of digital infrastructure assets which deliver a reliable, functioning internet. The IPO Prospectus is expected to be  published in March 2021.

Cordiant Digital Infrastructure  to admit its shares on the Specialist Fund Segment of the Main Market of the London Stock Exchange . Targeting a £300m raise. Cordiant invests in global infrastructure and real assets, running infrastructure private equity and infrastructure private credit strategies through limited partnership funds and managed accounts. Due 16 Feb.

4basebio UK Societas   is a specialist life sciences group focused on therapeutic DNA for gene therapies and DNA vaccines and providing solutions for effective and safe delivery of these DNA based products to patients.  The Company has been divested from 4basebio AG , a German company listed on the Prime Standard segment of the Frankfurt Stock Exchange . No capital to be raised on Admission. Anticipated market capitalisation on AIM Admission: £14.53m. Due 17 Feb

Cornish Metals (TSX-V: CUSN) intends to list on AIM. The Company is proposing to raise £5m by way of private placement of new Common Shares to advance the United Downs copper-tin project. The Company expects that Admission will become effective 16 February 2021.  The Company’s Common Shares will continue to be listed and trade on the TSX-V in Canada. Raising £8.2m. £18.7m mkt cap.

 

Banquet Buffet

One Heritage Group* 36.5p  £11m (LON:OHG)

The UK-based residential developer focused on the North West of England, has raised £548,500 at 30p. Further it has exchanged contracts on Plus House, Stockport for £725,000. Completion is expected on 31 March 2021 with the acquisition to be funded through the Placing, Subscription, existing cash resources and the shareholder loan facility.

The property is currently used as an office but has been acquired with the benefit of permitted development planning approval to convert the first, second and third floor into twelve apartments with approximately 2,500 square foot of office space on the ground floor.

Management are exploring revising the planning to add an extension which adds an additional three apartments, this increases the total to fifteen.

The Company expect construction to start in Q2 2021 with completion during Q2 2022 even with the revised extension. The Company expects a development cost of £1.0 million with a Gross Development Value (GDV) on completion of £2.3 million. The costs and timelines are dependent on the permitted development planning approval and do not include the planning extension as envisaged.

 

MediaZest* 0.13p  £1.8m (LON:MDZ)

The creative audio-visual company, updated on new business wins since the beginning of 2021.

Mandates for several new projects have already been won in the new calendar year, including the extension of existing recurring revenue contracts with a long standing client, and a large project for a new client, due for delivery in the first six months of the calendar year. In aggregate these new business wins will generate over £350,000 in revenue and include client engagements which the Directors believe have the potential to grow substantially over the coming months.

MediaZest expects to announce its financial results for the 18-month period ended 30 September 2020 later this month.

 

Petards Group* 13p  £7.5m (LON:PEG)

The developer of advanced security and surveillance systems, announces a trading update for the year ended 31 December 2020. Against a difficult backdrop, the group were quick to implement a comprehensive restructuring program that they believe will deliver improved results in 2021. 

Part of the group’s action plan was a strong focus on cash generation which certainly was reflected in the numbers with closing cash of £2.2m. Revenues for the year are expected to be approximately £13m with a slightly improved result compared with the prior year at the adjusted EBITDA level (2019: £0.3m loss).

The year-end order book stood at over £12m of which £10m is currently scheduled for delivery in 2021 with a weighting to the first half of the year.

Petards has recently created a virtual Petards Technology Centre to capitalise upon the wider Group’s technical and development expertise. Our strategic objective is to enhance eyeTrain’s technically advanced on-train sensing systems. This is envisaged to be achieved through use of “best of breed” third party applications, particularly those related to data capture, transmission and analytics.

While it is presently too early in the year to re-instate market guidance, the Board is cautiously hopeful of improved results in 2021.

 

IQE 78.15p  £626m (LON:IQE)

 The leading supplier of advanced wafer products and material solutions to the global semiconductor industry, today provides an update regarding an ongoing, multifaceted intellectual property legal dispute.

The dispute has been referenced previously in IQE’s 2018 and 2019 Annual Reports, where the associated legal costs were listed as exceptional costs.  

An arbitration hearing relating to this matter was held in September 2019 and the Tribunal’s Final Award was delivered in January 2020. The Tribunal’s award was entirely in IQE’s favour.  Since then, the parties have been engaged in litigation in U.S. federal court regarding the effect of the Tribunal’s decision on cases that had been brought against IQE and IQE employees in that court.

The parties have settled the claims out of court and IQE has now received a full and final settlement payment of US$2.5m.

 

Robinson 157.5p  £26.2m (LON:RBN)

The custom manufacturer of plastic and paperboard packaging, announced that on 10 February 2021 the Company acquired Schela Plast A/S, a Danish designer and manufacturer of blow moulded containers. Total consideration, including earnout, is expected to be £7.7m on a debt free cash free basis.

Highlights:

· Schela Plast specialises in the design and manufacture of plastic blow moulded containers

· Complementary market sectors to those served by Robinson

· Expands geographic reach and creates sales growth opportunities with new and existing Robinson customers – healthy pipeline of new FMCG business

· Acquisition expected to be immediately earnings enhancing

For the year ended 31 December 2020, Schela Plast achieved revenues (unaudited) of DKK 76.1m (£9.1m) (2019: DKK 59.6m (£7.0m)), and EBITDA (unaudited) of DKK 13.4m (£1.6m) (2019: DKK 6.4m (0.7m)). 

 

Warehouse REIT 127.25p  £541m (LON:WHR)

-400,000 sq ft deal takes total WHR portfolio past eight million sq ft-

 The AIM-listed company that invests in e-commerce urban and last-mile industrial warehouse assets in the UK, announces the acquisition of four modern warehouse units on Boulevard Industry Park in Speke, Liverpool, totalling 390,000 sq ft. The purchase price of £35 million reflects a net initial yield of 5.5%. 

Ranging from 74,000 sq ft to 163,000 sq ft, the units are occupied by three separate occupiers spanning the automotive and pharmaceutical sectors. The properties generate a net rental income of £2.1 million per annum equating to a low average rent of £5.31 per sq ft and provide a WAULT of over 7 years. 

Boulevard Industry Park is one of Liverpool’s most successful and popular business locations, immediately adjacent to Jaguar Land Rover’s 300-acre Halewood manufacturing plant and major Astra Zeneca and Seqirus facilities. 

 

Harvest Minerals 2.6p  £4.83m (LON:HMI)

Harvest Minerals Limited, the AIM listed remineraliser producer, announces that it has relinquished its exploration license over, and returned to the National Mining Agency its 100 per cent. interest in, the Capela Potash Project  in Brazil, to dedicate its resources and to ensure the continued growth trajectory at its 100% owned revenue generating Arapua Fertiliser Project. 

 No further expenses, which in recent years had been limited to minimal licence fees, will be incurred by Harvest with respect to Capela and all remaining obligations under the Capela Potash Project Agreement (as defined in the Company’s AIM Admission Document) have fallen away.  

 

Agronomics 17.25p  £86.6m (LON:ANIC)

Agronomics, a leading listed investor in alternative proteins with a focus on cellular agriculture and cultivated meat, announced portfolio company New Age Meats (trading name for Simply Foods, Inc) has raised a further US$ 2 million via convertible debt. In July 2019, Agronomics completed a subscription of US$ 699,999.34 for 885,739 Series Seed Preferred Shares. Agronomics currently holds approximately 7.0% in New Age Meats on a fully diluted basis. This further raise does not result in a change to the carrying or implied value of Agronomics’ holding in New Age Meats.

The full announcement is set out below with no material changes or adjustments.

 

Kodal Minerals 0.09p  £10.97m (LON:KOD)

Update on the results of the surface geochemical sampling completed at the Dabakala Concession, Côte d’Ivoire, in December 2020. The Company also continues preparations for its 2021 field season to undertake exploration drilling at the Fatou Project in southern Mali, and the Nielle Project in Côte d’Ivoire.

 · High grade gold geochemical samples up to 6.14g/t gold returned for the surface at Dabakala Concession, central Côte d’Ivoire;

· Extensive surface gold anomalism defined in the east of the Concession extending for over 10km of strike and multiple interpreted trends;

· Extensive artisanal workings identified during the sampling programme and anomalism extends beyond and parallel to the workings;

· Gold anomalous zone confirmed in multiple phases of sampling and geological reconnaissance identifies geological and structural controls on the gold mineralisation;

· Field inspection of Dabakala anomalism planned for February 2021;

· Field reconnaissance underway at the Fatou Project to review historical drilling and proposed drill hole sites.

 

Gaming Realms 35.4p  £101.6m (LON:GMR)

The developer and licensor of mobile focused gaming content, announces a pre-close trading update for the full year to 31 December 2020. It expects FY20 revenue and adjusted EBITDA will be c .£11.2m and c.£3.1m respectively. This reflects a record month in December due to the Company’s content licensing business, which has continued to go from strength to strength. It grew by over 100% during FY20 – launching with 26 new partners, including Tier 1 operators DraftKings in the U.S., as well as Sky Betting and Gaming and PaddyPower Betfair in the UK and Europe.

The positive momentum reported above has continued into the start of FY21, with the Company recently announcing the launch of its Slingo content in Italy with both Goldbet and Sisal. 

The development of the Group’s US strategy has continued into the current year, with the signing of a number of key contracts in the US, including a multi-state contract with BetMGM to provide content through a direct integration. In addition, the Company has been granted a provisional supplier licence by the Michigan Gaming Control Board

 

Head Chef

Derren Nathan

0203 764 2344

[email protected]

 

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