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Penny Share Review 162

Monday 09 December 2002

The Weekend's Comments The FT from today reports that Big Pharma companies may finally be waking up to the potential of the smaller bio tech operations following the collaboration of Roche and Antisoma. That deal saw Roche part with £27m in exchange for a 10% stake in a Company valued at £26.5m and a share of the rights from any future drugs. The article notes that Big Pharma companies are running out of products due to a loss of patent protection and a thin product pipeline while the little Biotechs have issues with cash. Therefore, this type of deal may become more prevalent especially as at present the "the biotech sector pipeline is significantly undervalued" and is focused on areas that the Big Pharma companies are targeting. One Company that "should be in a position to do a deal in the next 12 months" is Alizyme (AZM), "one of the few UK companies not to have experienced a product failure." For shareholders this may result in short-term froth, but with any ongoing excitement regarding drug development being mitigated by the involvement of the larger partner. Therefore, there may be downside as well. This type of deal may be "the pragmatic solution to the problems of both Big Pharma and Little biotech", but shareholders "must let go of their long-held aspirations for rocketing biotech growth and settle down for a steadier ride." At 11.55 the shares were up 0.5p to 32p from Friday's close. Positive interim results from Gamingking (GGK.L - formerly Lotteryking Holdings & theBiz) are reported in Saturday's Daily Express. Chairman Leslie Hurst is optimistic and the Group is looking at new business opportunities. The shares were up 0.05 to 0.9p at 11.56 from Friday's close. Developments at Oxus Mining (OXS) get a write-up in today's FT. The Company is now under the direction of MAED, the largest shareholder, and MAED would prefer to partner up with a large South African mining company rather than finance the mine construction through the banks. The partnership model would allow the Company to access the 500,000 ounces of gold lying between 300 and 400m underground, which would generate monthly profits of around $6m. In contrast going it alone with funds provided by the banks would mean that the Company would only be able to tap into the 170,000 ounces at the surface, providing $3m profit per month. There is a certain degree of urgency about securing funding and beginning production, as any profit that is made from Amantaytau within five years will be exempt from 16% tax payable in Uzbekistan. At 11.56 the shares were unchanged at 6p from Friday's close. The Daily Mail from Saturday commented that Wayne Rooney's parents are waiting until after December 12th when his contract with Peter McIntosh expires and he joins Proactive Sports (PAS.L). Everton, his club, have been keen to sign the player since October 24th when he turned 17, but the Company has been unwilling to begin negotiations, as it has not finalised discussion with Mr McIntosh, who claims he is entitled to a cut of the player's fresh contract. The shares were down 0.5p to 8.5p at 11.56 from Friday's close. There was a brief mention in Saturday's Independent about Protec (PRC), which noted that after the upbeat AGM statement traders rushed into the stock while Reflec (REF) got a little write up in The Guardian on Saturday after the much rumoured stake building by Shami Ahmed was formally announced on Friday. He now holds 7.06% of the Company. Protec shares at 11.56 were down 0.25p to 6.5p from Friday's close. At 11.57 shares in Reflec were down 0.25p at 1.375p from Fridays close.

Today's Announcements The following companies, in which City Equities customers may have an interest, released announcements to the market this morning. These can be found by entering the relevant company name or ticker code in the search box on this site.

Henderson Morley (HML) - Signed Heads of Agreement.

Look Out For This Week

9 Dec - UK Producer Price Index, BRC retail sales monitor, Germany Industrial production (Oct).
10 Dec - Invox AGM, UK Trade data (Oct)
11 Dec - Japan current account balance (Oct)
12 Dec - Uk CBI monthly industrial tends survey, Eurozone ECB bulletin (Dec), US Retail sales (Nov), Federal Reserve minutes.
13 Dec - US Producer price Index (Nov), Business Inventories (Oct), Michigan consumer sentiment.

Compiled by Andrew McLintock

Penny Shares Online - penny shares research and information service.




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