Small Cap Wrap – Zephyr Energy, Silence Therapeutics, Parsley Box and more…

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Our daily digest of news from UK listed Small and Mid caps


@HybridanLLP


15 October 2021




*A corporate client of Hybridan LLP




Joiners


Light Science Tech Holdings (LON:LST), the controlled environment agriculture technology and contract electronics manufacturing Group has joined AIM. Raising GBP5.2m. Market Capitalisation approximately GBP17.4m.




Leavers


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What’s cooking in the IPO kitchen?


Gymshark has started to put together plans for a stock market listing according to City A.M. The company hit a GBP1bn valuation just over a year ago and boasts customers in more than 130 countries. Gymshark was founded by teenager Ben Francis in 2012 in his parents’ garage with products that appeal to Gen Z consumers. Timing TBA


Rubix Group Holdings, the market leading pan-European distributor of industrial maintenance, repair and overhaul products and services is considering an initial public offering Main Market (Premium). In the six months ended 30 June 2021, Rubix generated Revenue from Ongoing Operations of EUR1,312m and Adjusted EBITDA of EUR123m (9.4% Adjusted EBITDA Margin from Ongoing Operations), an increase of 10.6% and 19.3% compared to the six months ended 30 June 2020, respectively. Raising proceeds equivalent to approximately EUR850m, and additionally may also include the sale of existing ordinary shares by current shareholders. Timing TBA


Firering Strategic Minerals to join AIM, a holding company for a group of exploration and development companies set up to focus on developing assets towards the ethical production of critical metals. The Company’s portfolio of assets is located in Cote d’Ivoire and contains projects that the Directors believe to be prospective for lithium and columbite-tantalite. Due Early Nov. Offer TBA


Harmony Energy Income Trust to join the Specialist Fund Segment of the Main Market raising up to GBP230m. The Company’s investment objective is to provide investors with an attractive and sustainable level of income returns, with the potential for capital growth, by investing in commercial scale energy storage and renewable energy generation projects, with an initial focus on a diversified portfolio of battery energy storage systems located in Great Britain. The Company has contracted with Tesla Motors Limited in respect of its initial portfolio of battery storage projects, to be acquired on IPO, which will benefit from Tesla’s 2-hour duration Megapack systems and Autobidder AI revenue optimisation platform. Due Early Nov.


Stelrad Radiator Group, the specialist manufacturer and distributor of steel panel radiators in the UK, Europe and Turkey, is considering an IPO on the Main Market (Premium). Potential secondary and primary (c.GBP25m) offer. Timing TBA.


Pantheon Infrastructure to join the Main Market (Premium). PINT will target attractive risk-adjusted total returns comprising capital growth and a progressive dividend through making equity and equity-related investments in private infrastructure assets alongside other leading private asset investment managers. Due Mid Nov.


Quantum Exponential to join AQSE. The Company intends to identify investment opportunities in the quantum technology sector primarily in the NATO allied countries. The Company has identified over 175 start-ups which potentially meet their investment strategy with a focus on seed funding for start-ups with second stage funding plans in preparation. Offer and timing TBA.


Pod Point, one of the United Kingdom’s leading providers of Electric Vehicle charging solutions is considering a Main Market (Premium) listing. As at 30 June 2021, Pod Point had installed more than 89,000 home charge points and over 13,000 commercial units, including those located at workplaces and destination locations (such as shops and leisure attractions). Timing and offer TBA.


Tungsten West to Join AIM. Tungsten West is the 100% owner and operator of the historical Hemerdon tungsten and tin mine located near Plymouth in southern Devon. Hemerdon represents the world’s third largest tungsten mineral resource, with a JORC (2012) compliant Mineral Resource Estimate of approximately 325Mt at 0.12 WO3. Capital raised on Admission: GBP39m. Anticipated Mkt Cap: GBP106.2m. Expected 21 Oct.


Softline the global solutions and services provider in digital transformation and cybersecurity, with its headquarters in London, is considering proceeding with a potential initial public offering of global depositary receipts representing its ordinary shares. The Company is considering applying for admission of the GDRs to the standard listing segment of the Official List of the FCA and to trading on the Main Market for listed securities and on Moscow Exchange. The Group had a turnover of US$1.8 bln for the year ended 31 March 2021, employs c.6,000 people globally, and operates in more than 50 countries across emerging markets. Primary proceeds from the Offer are expected to be around US$400m. Due Late Oct.


Marks Electrical, a fast growing online electrical retailer, announced its intention to proceed with an initial public offering and to seek admission to trading on AIM. Marks Electrical sells, delivers, installs and recycles a wide range of household electrical products. In the year to 31 March 2021 revenue grew to GBP56m, up 78% against the previous financial year, while EBITDA increased to GBP7.45m, at a 13.3% EBITDA margin. The Group has made a strong start to its current financial year to 31 March 2022, with revenue growth of 78% in H1 FY2022, versus 47% growth in H1 FY2021. Offer TBA Admission is expected to take place in late October 2021.


Future Metals NL (ASX:FME) (ASX:FME) (formerly named Red Emperor Resources NL) to join AIM. No funds being raised. Future Metals is a platinum group metals exploration and development company that holds a 100% interest in the Panton PGM Project in Western Australia. The Panton Project comprises 3 granted mining leases (M80/103, M80/104 and M80/105), which cover an area of approximately 23km2 and are located 60km north of Halls Creek and 1km from the Great Northern Highway, in the East Kimberly region of Western Australia. The Panton Project has a JORC (2012) Mineral Resource Estimate of 14.3Mt at 2.19g/t platinum, 2.39g/t palladium, 0.31g/t gold, 0.27 per cent. nickel and 0.08 per cent. copper. Due mid October. Mkt cap cGBP35.8m.


Bens Creek Group to join AIM. Bens Creek, together with its subsidiaries, will, on Admission, own and operate a metallurgical coal mine located on 10,000 acres in the southern part of the state of West Virginia and eastern edge of the Commonwealth of Kentucky, in the central Appalachian Basin of the eastern United States of America. The mine’s operations are located primarily in Mingo County, West Virginia. The mine includes a wash plant and rail loading facility located on the freehold land. Capital to be raised on Admission: GBP7m. Anticipated Mkt Cap on admission: GBP35m. Due 19 Oct.


M7 Regional E-Warehouse REIT intends to apply for admission onto The Property Stock Exchange (Wholesale Segment). On Admission, the company plans to acquire a portfolio of UK retail warehouses worth GBP120m from M7 Real Estate Investment Partners VIII. The portfolio currently comprises 18 retail warehouse properties across the UK totalling 978,317 sq ft and fully let to 53 occupiers. Rent collections for Q2 2021 stand at 93% and are expected to revert to 100% in the coming quarters.


Castlenau Group to join the Specialist Fund Segment of the LSE’s Main Market. Castelnau was incorporated with limited liability in Guernsey under the Companies Law on 13 March 2020 as a closed-ended company limited by shares. The Company’s investment objective is to compound shareholders’ capital at a higher rate of return than the FTSE All Share Total Return Index over the long term. The Company is targeting an issue in excess of GBP170m. Sir Peter Wood, British entrepreneur and innovator, has committed to make a cornerstone investment of GBP25m in the Initial Placing. Due 18 Oct.


Responsible Housing REIT to join the Main Market (Premium) raising up to GBP250m. The Company’s investment objective is to generate a consistent and sustainable income-based return from the provision of Supported Housing accommodation assets and aligned sectors. The Company will acquire and create quality, fit-for-purpose accommodation assets to cater for supported residents across a number of care sectors including adults and young people with learning disabilities, mental health issues, physical disabilities, addiction, those with support needs, those in need of temporary accommodation, the elderly and otherwise vulnerable individuals.


Central Copper Resources, a company focused on delivering a high grade copper project into production and exploration of assets in the Democratic Republic of the Congo (DRC) and in the Republic of Zambia to join AIM. By 2022, CCR intends to be ready to commence the project financing of its Mbamba Kilenda copper project. It pushed back its AIM float on 30th September from end September to late October. The amount to be raised is still yet to be confirmed.




Banquet Buffet


Falcon Oil & Gas 8.55p GBP83.9m (LON:FOG)


Announces that drilling of the Velkerri 76 S2-1 vertical appraisal well has been completed, with the well drilled to a vertical total depth of 2,129 metres in the Beetaloo Sub-Basin, Northern Territory, Australia with joint venture partner, Origin Energy B2 Pty Ltd., a wholly owned subsidiary of Origin Energy Limited. Preliminary evaluation of the Velkerri-76 well is very encouraging and confirms the presence of four prospective intervals within the Amungee Member (formerly known as the Middle Velkerri), the A, AB, B and C shales, as established in the Amungee NW-1 / 1H, Beetaloo W-1 and Kalala S-1 wells. The continuation of the regionally pervasive Amungee Member within the Velkerri Formation towards the eastern flank of the Beetaloo Sub-Basin approximately 78 kilometres from the Amungee NW-1H and 73 kilometres from the Beetaloo W-1 wells has been identified. The Amungee Member is likely within the wet gas maturity window as evidenced by mud gas data during drilling.




ITM Power 441p GBP2,416.3m (LON:ITM)


On 14 October 2021, the energy storage and clean fuel company, announced the launch of a placing by way of an accelerated bookbuild. The Placing has now closed. The Company announces today, that the Placing was oversubscribed, and that it has conditionally placed shares at a price of 400 pence per New Share. In conjunction with the Placing, Linde and a member of the senior management have subscribed shares in the capital of the Company. The total gross proceeds of such Director and management participation will be approximately GBP0.5m. The total gross proceeds from the Capital Raise will be, approximately GBP250m. The New Shares being issued represent approximately 11.4 per cent of the existing issued ordinary share capital of the Company prior to the Capital Raise.




Learning Technologies Group 201.60p GBP1,590.60m (LON:LTG)


Further to its announcement of 8 October 2021, Learning Technologies Group plc, the provider of services and technologies for digital learning and talent management, announces the successful completion of the acquisition of GP Strategies. The combined business will generate pro-forma revenue of c.GBP500m and provide LTG with an enhanced global footprint with over 5,000 employees in more than 80 countries. LTG has a strong track record of successfully integrating acquisitions and has identified significant margin enhancement and cross-sell opportunities. LTG expects the transaction to be significantly EPS accretive from 2022. The transaction is financed by an GBP85m share placing and $305m of debt financing, both completed in mid-July. The Board will update shareholders on progress in early 2022.




Power Metal Resources 1.80p GBP22.3m (LON:POW)


The London listed exploration company seeking large-scale metal discoveries across its global project portfolio announces the results from recently completed satellite imagery analysis over the Garfield Property located in the prolific Walker Lane Mineral Belt in Nevada, USA. Analysis of Advanced Spaceborne Thermal Emission and Reflection Radiometer (ASTER) and European Space Agency Sentinel-2 datasets has been undertaken by global image processing expert Dr. Neil Pendock from Dirt Exploration based out of Cape Town, South Africa. This analysis identified two strong anomalies, prospective for copper mineralisation, as evidenced by detailed mathematical analysis of spectral end members that correlate with known copper mineralistion in the area. The new anomalies are located over 1km and 1.5km away from the main Garfield showings, expanding the potential copper mineralisation footprint significantly. A map highlighting the newly acquired ground, as well as the copper anomalies identified by the analysis can be found at the following link: https://www.powermetalresources.com/garfield-project/




M.P.Evans Group 850p GBP463.3m (LON:MPE)


The Group announces the completion of its disposal of Bertam Estate, comprising 70 hectares of land near Penang Island in Malaysia, for US$24m. The proceeds support continuing investment in the Group’s sustainable Indonesian oil-palm projects. Commenting on the completion of the disposal, chairman of MPE, Peter Hadsley-Chaplin, said: “Completion of the Bertam Estate sale is an important step forward for the Group and the sale proceeds will support its continuing investment in sustainable Indonesian oil-palm. This welcome, cash-generative, transaction further underlines the board’s stated intention to recommend a total dividend of at least 30p per share in respect of 2021.”




Ncondezi 1.375p GBP5.6m (LON:NCCL)


The company announces that Ncondezi Green Power its wholly owned renewable energy subsidiary has agreed an extension to the Directors Bridge Loan announced on 4 May 2021. In order to ensure the Company has sufficient time to refinance the Bridge Loan, a Bridge Loan Extension has been entered into by Scott Fletcher, Hanno Pengilly and Michael Haworth as Lenders and Ncondezi Green Power as borrower. The Bridge Loan Extension provides for the Bridge Loan to be repaid 20 business days after the existing repayment date taking the repayment Date to 7 December 2021. Should NGP fail to meet the new Repayment Date the existing conversion and default conversion rights will still apply.




Newmark Security 0.875p GBP4.1m (LON:NWT)


A leading provider of electronic and physical security systems, announces a trading update and notice of its annual general meeting and a proposed capital reorganisation. The Company has maintained a key focus on cash in light of the challenges faced in managing inventory levels and dealing with the global shortage of components needed to build products. The Company has sought to bolster levels of stock held in order to build in a buffer to ensure that the global supply chain issues do not impact the Group’s ability to fulfil existing and anticipated client orders, and to better withstand the risk of future supply-chain disruption. This increased working capital outlay, coupled with the significantly higher freight costs and increased component costs, has negatively impacted gross margins and cashflows in the first four months of the year ending 30 April 2022. As a result of this, the Company has instigated a number of initiatives to improve profitability and cashflows, providing the Board with confidence that the Group is well positioned to navigate these market conditions for the rest of the financial year. The Company will hold its Annual General Meeting on 10 November 2021. As part of the business of the AGM, the Company is proposing a reorganisation of its share capital which will involve a sub-division and subsequent consolidation of the Company’s share capital.




Parsley Box 58.55p GBP179.6m (LON:MEAL)


The direct-to-consumer provider of ready meals focused on the Baby Boomer+ demographic, announces that John Swan has formally resigned as a Director of the Company following the announcement of his retirement on 7 September 2021. Kevin Dorren, CEO of Parsley Box said: ” I should like to thank John for his valuable contribution, expertise and support over the past few years. It has been a pleasure to work alongside John and he retires with the best wishes and thanks of us all at Parsley Box.”




Silence Therapeutics 521p GBP471.3m (LON:SLN)


The Company, a leader in the discovery, development and delivery of novel short interfering ribonucleic acid (siRNA) therapeutics for the treatment of diseases with significant unmet medical need, announces its intention to cancel the admission of its ordinary shares to trading on AIM, subject to shareholder approval, with effect from 30 November 2021. Subject to shareholder approval, the Company’s last day of trading on AIM will be 29 November 2021. Silence will retain the listing on the Nasdaq Global Market. The board of directors believes that the AIM Delisting should enhance the liquidity of trading in the Company’s ADSs as all such trading will be concentrated in a single venue. The Company also announces today, a collaboration with Hansoh Pharmaceutical Group Company Limited, one of the leading biopharmaceutical companies in China, to develop siRNAs for three undisclosed targets leveraging Silence’s proprietary mRNAi GOLD(TM) platform. Under the terms of the agreement, Hansoh will have the exclusive option to license rights to the first two targets in Greater China, Hong Kong, Macau and Taiwan following the completion of phase 1 studies. Silence will retain exclusive rights for those two targets in all other territories. Silence will be responsible for all activities up to option exercise and will retain responsibility for development outside the China region post phase 1 studies. Hansoh will also have the exclusive option to license global rights to a third target at the point of IND filing. Hansoh will be responsible for all development activities post option exercise for the third target. Hansoh will make a $16m upfront payment and Silence is eligible to receive up to $1.3bn in additional development, regulatory and commercial milestones. Silence will also receive royalties tiered from low double-digit to mid-teens on Hansoh net product sales.




Zephyr Energy 7.30p GBP93m (LON:ZPHR)


The Rocky Mountain oil and gas company focused on responsible resource development from carbon-neutral operations, provides an update on operational activity on its flagship project in the Paradox Basin, Utah. All equipment and materials required for hydraulic stimulation (including water tanks, water and proppant materials) have been successfully mobilised to the State 16-2LN-CC well pad, and that completion operations are scheduled to commence on 18 October 2021. It is anticipated that completion of the well will be finished in under a week, at which point the Company will commence production testing. The Company expects to be able to provide updates on initial production volumes within four weeks of commencement of the production test.




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