Small Cap Wrap – Gaming Realms, GRC International, Mercia Asset Management and more…

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2nd November 2021


*A corporate client of Hybridan LLP




Joiners


Hostmore plc (LON:MORE) has demerged from Electra Private Equity (LSE:ELTA) PLC, and the shares admitted to the Premium Segment of the Main Market.. Hostmore is a growing hospitality business with its current operations focused on the American-themed casual dining brand, Fridays, and the cocktail-led bar and restaurant brand, 63rd+1st.




Leavers


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What’s cooking in the IPO kitchen?


Ashtead Tech, subsea equipment rental and solutions provider for the global offshore energy sector to join AIM. The Directors have a high degree of confidence in the Group achieving no less than GBP52m of revenue, GBP21.5m of Adjusted EBITDA and GBP12.8m of Adjusted EBITA for FY21 Due late Nov. Offer TBA.


Atrato Onsite Energy, a new closed-ended investment company established to invest in a diversified portfolio of onsite renewable energy assets to join the Main Market (Premium). Targeting a GBP150m raise. Due by end Nov.


Foresight Sustainable Forestry Company to join the Main Market (Premium), an externally managed investment company that will invest in UK forestry and afforestation assets. Raising up to GBP200m. Due 24 Nov.


Travel Chapter Holdings to join AIM. Travel Chapter operates a leading online platform in the structurally growing UK holiday rental market, connecting a supplier base of property owners with their customers and providing a market leading service proposition to both. Offer TBA. Due mid Nov.


Gensource Potash Corp (TSX-V:GSP) to join AIM. Gensource is a TSX-V listed fertilizer development company located in Saskatchewan, Canada, focused on a sustainable and modular approach to potash production. The Company currently holds 100% interest in KL 244 and KL 245, the subsurface mineral leases comprising the Vanguard Area (296.43 km2). The Company also holds mineral leases in its Lazlo Area (24.93km2) in the south of Saskatchewan. Due early Nov. No funds being raised.


ATOME headquartered in Leeds, focussed on the large-scale production of green hydrogen and ammonia intends to join AIM towards the end of the year. ATOME intends to be spun-out from AIM-listed President Energy PLC (AIM:PPC), an oil and gas company which has incubated and financially supported ATOME to date, by way of a dividend in specie and flotation.


Devolver Digital to join AIM, an award-winning digital video games publisher and developer in the indie games space. Recently awarded indie ‘Publisher of the Year 2021’ by GamesIndustry.biz. Offer TBA. Due early Nov.


Life Science REIT to join AIM raising up to GBP100m. This will be the first London listed real estate investment trust (REIT) focused on UK life science properties. Due mid Nov.


Alinda Capital Infrastructure Investments to join the Specialist Fund Segment of the Main Market of the London Stock Exchange raising up to GBP350m. Due Late November.


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. Q4 2021.


ProCook, the UK’s leading direct-to-consumer specialist kitchenware brand, is considering applying for admission of the Shares to the Main Market (Premium). ProCook’s revenue grew by 37% to GBP53.4m in FY21 (ending 4 April 2021), with Adjusted EBITDA growing by 246% to GBP13.3m in the same period. Due in November.


Silverwood Brands, an investing company established to identify investment opportunities including, but not limited to, in the foods, organic food, wellness, lifestyle and leisure sectors, targeting admission on the to join the AQSE Growth (Access). Due 8th Nov. Offer TBA.


Kasei Holdings, a technology specialist investor that focuses on cryptocurrencies and blockchain technologies, due to join the AQSE Growth Market 27 Oct. No funds being raised. Due 3rd Nov.


Rubix Group Holdings, the market leading pan-European distributor of industrial maintenance, repair and overhaul products and services to IPO on the 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 EUR850m, potential sale of existing ordinary shares by current shareholders. Raising EUR 850m. Due early Nov.


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 invest 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. 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). Secondary and primary (c.GBP25m) offer. Early Nov.


Pantheon Infrastructure to join the Main Market (Premium). PINT will make investments in private infrastructure assets. Due Mid Nov.


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. Timing and offer TBA.


Marks Electrical, a fast growing online electrical retailer, announced its intention to proceed with an initial IPO 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 early Nov 2021.


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.


Central Copper Resources, a company focused on delivering a high grade copper project into production and exploration of assets in the 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. Due Mid Nov. Offer TBC.




Banquet Buffet


Gaming Realms 39.2p GBP113.17m (Gaming Realms PLC (AIM:GMR, OTCQX:PSDMF))


The developer and licensor of mobile focused gaming content, is pleased to announce that since being issued with its provisional iGaming Supplier Licence in Michigan in January 2021, it has now been approved for a full licence by the state regulator, adding to its two other full licences for New Jersey and Pennsylvania. In terms of new gaming licences, the Company’s application to supply games in Ontario has been submitted and is currently being processed. The Company continues to be encouraged by the performance of its games across its North American and European markets and remains confident of meeting its full year targets. During Q3 2021, content licensing revenue increased 35% year on year whilst the new licensing and games pipeline has also grown. The Company is also pleased to announce that its Slingo content has recently gone live with Wynnbet in New Jersey and Fanduel in Michigan.




GRC International 36.5p GBP36.5m (GRC International Group PLC (AIM:GRC))


The supplier of IT governance, cyber security, risk management and compliance products and services, updates in respect of its trading performance in H1 FY22 (6 months ending 30 September 2021). The Group saw the strong positive momentum which it reported through H2 FY21 continue across all areas of the business in H1 FY22, notwithstanding the economic headwinds in the UK economy from the on-going impact of COVID-19, rising energy prices, inflationary pressures and staff shortages. As a result, billings in H1 FY22 were up 26% on the comparative period to GBP7.1m. The improved H1 FY22 performance generated positive EBITDA for the period, the first time that the Group has reported an EBITDA positive 6-month period since the first set of results it reported after it was admitted to trading on AIM in March 2018.




Mercia Asset Management 39p GBP171.6m (Mercia Asset Management PLC (AIM:MERC))


The proactive, regionally focused specialist asset manager with c.GBP940m of assets under management, announced that its third-party managed fund portfolio company Pimberly Limited, has completed a GBP4.3m funding round to expand into the US market and accelerate its growth in the UK. Mercia has invested GBP1.4m from its own balance sheet, alongside a further GBP2.9m investment by the Mercia managed Northern VCTs. Following this investment, Mercia holds a 5.6% fully diluted direct equity stake in Pimberly, with the Northern VCTs holding a further 11.7% fully diluted equity stake. Pimberly is a Manchester-based software-as-a-service company whose platform helps retailers, distributors and manufacturers increase sales by enabling them to harness and enrich the increasing volumes of product data they have across multiple channels and regions. High-profile customers include Ellis Brigham, JD Sports and Monsoon.




MTI Wireless Edge 71.5p GBP63.3m (MTI Wireless Edge Limited (AIM:MWE))


The technology group focused on comprehensive communication and radio frequency solutions across multiple sectors, announces that its antenna division has received blanket orders for 5G backhaul antenna from two key customers. The combined orders are worth approximately USD $0.85m and are to be supplied in 2022. MTI’s CEO, Moni Borovitz, commented : “These significant new orders demonstrate the strength of our 5G backhaul solution and our customers’ satisfaction with it. The orders are expected to be supplied before the end of 2022 and will be part of our expected uplift in 5G sales next year.”




Novacyt 248.5p GBP177.4m (Novacyt S.A. (AIM:NCYT))


The international specialist in clinical diagnostics, announces an update on the availability of its COVID-19 tests in the UK following implementation of the UK Health Security Agency’s Medical Devices (Coronavirus Test Device Approvals) (Amendment) Regulations 2021 (CTDA). Novacyt submitted 11 products for review on time to meet the original CTDA submission deadline of 1 September 2021. To date, Novacyt’s Primerdesign Ltd PROmate(R) COVID-19 test has been named on the temporary protocol (this encompasses both the PROmate(R) 1 Gene q16 and q32 products). The CTDA has not yet communicated the status of any of the remaining nine products. As a result, from 1 November 2021, the Company will only be selling the PROmate(R) COVID-19 test in the UK until such time the UK Health Security Agency completes its review of the additional nine products submitted. If no further products are added to the CTDA register, the impact on full year revenues for 2021 will be circa GBP3m.




Seed Innovations 7.35p GBP15.6m (SEED Innovations Ltd (AIM:SEED))


The company investing in fast growing and industry leading businesses with a focus on the medical cannabis, health and wellness space, updated on its portfolio company Eurox Group, a German-based, European vertically integrated medical cannabis company. Eurox has successfully started sales in Germany to a number of select customers of dronabinol, the primary psychoactive compound in cannabis also known Delta-9-tetrahydrocannabinol (?9-THC). Sales of ?9-THC represents a new revenue stream for Eurox, which follows the distribution agreement of Eurox’s full-spectrum extracts to pharmacies during the previous calendar quarter. SEED has an 8.85% shareholding in Eurox.




Shearwater Group 136p GBP32.4m (Shearwater Group PLC (AIM:SWG))


The organisational resilience group which provides cybersecurity, advisory and managed security services, updated on trading for the six months ended 30 September 20211, ahead of the publication of the Group’s Interim Results in late November. For the traditionally quieter first half of the year, the Group expects to report encouraging underlying EBITDA growth, up 19% year-on-year to GBP1.3m in H1 FY22 in line with the Board’s expectations (H1 FY21: GBP1.1m). This growth is driven by an improved underlying EBITDA margin of 12% (H1 FY21: 10%), reflecting the increasing proportion of higher margin software and advisory revenue within the revenue mix . Revenue for the first half of the year is expected to be GBP10.6m (H1 FY21: GBP11.2m). In line with the Group’s historical trends, c.50% of H2 revenue is either already contracted or anticipated to be generated through renewals.




Tungsten Corp 27.4p GBP34.7m (Tungsten Corp PLC (AIM:TUNG))


A leading provider of digital financial management products and software solutions, has been informed by NTT Ltd. that it will terminate the contract as announced in April 2021. Tungsten will continue to deliver the Integrated Supplier services that were previously in place. This decision was not due to performance but based on a change in NTT’s procurement strategy. The decision has no impact on FY22 revenues and no material impact on revenues for FY23. Tungsten remains fully committed to support NTT with any future digital transformation requirements.




ValiRx 45p GBP29.3m (ValiRx PLC (AIM:VAL))


The life science company focusing on early-stage cancer therapeutics and women’s health, announces today it has entered into a non-binding letter of intent with TheoremRx Inc., a recently incorporated company, a next generation drug development Company, to enter into a licence agreement on pre-agreed terms to sub-license ValiRx’s legacy asset VAL201 for development in the treatment of cancer, Completion of the Licence Agreement is subject to, inter alia, the successful fundraise by TheoremRx. Under this proposed Licence Agreement, TheoremRx will obtain a worldwide licence to ValiRx’s VAL201 intellectual property for a novel peptide targeting SRC kinase targeting oncology indications. ValiRx will retain the rights to develop the VAL201 peptide for non-oncology indications, including VAL301 for endometriosis. Subject to successful market authorisation, the potential value of the deal would be in excess of US$61M plus royalties for the first cancer indication alone. Each oncology indication successfully developed to by TheoremRx will generate up to $37.5M of additional value to ValiRx. The proposed deal structure comprises payments on signature of the Licence Agreement plus fees and near-term milestones totalling US$2.2M before the end of 2023, milestones on further clinical and commercial development events, and royalties. The first payments are expected by the end of 2021.




Watkin Jones 236.5p GBP606m (Watkin Jones PLC (AIM:WJG))


The developer and manager of residential for rent homes, announces a trading update for the year ended 30 September 2021. Operating profit for the year is anticipated to be in line with expectations. GBP430m forecast revenue, which is slightly below expectations, but with a stronger gross margin, reflecting the timing of land sales either side of the year end. GBP125m net cash at the end of the year, c. 50% above expectations. Good progress made in securing forward sales: 3 BtR schemes (722 apartments) and 8 PBSA schemes (2,435 beds) forward sold since the start of 2021, with a total revenue value to WJ of c. GBP450m.




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