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Penny Share Review 209

Monday 10 November 2003

Arc Risk Management's (ARC.L) small fundraising of £32,000 gets a brief mention in Saturday's Independent. Certain staff and directors subscribed for just over 2m shares and according to the Chief Executive Rob Whiting, this "demonstrates their commitment to the ongoing development of ARC." At 12.14 the shares were unchanged at 1.50p from Friday's close.

The Weekend FT picked up on AWG Services' (AWL.L) reverse takeover of Oak Holdings. The all-paper deal is worth £11.6m and the 490.3m shares issued represents 75% of AWG's enlarged capital. AWG shareholders are to receive 5 warrants for every 8 shares, which would be exercisable at 2.38p. It is proposed that the Company will change its name to Oak Holdings. The shares were down by 0.38p from Friday's close to 2.00p at 12.15.

Dermot Desmond, whose interests range from the Sandy Lane luxury hotel in Barbados to a major stake in Celtic Football Club, is said to be a secret shareholder in Cardpoint (CASH), according to the Financial Mail on Sunday. The Sunday tabloid quotes research by financial website Citywire, which revealed that Mr Desmond's stake is around 1.83% or 600,000 shares and speculates about the profit he might have made given that the shares have risen from 62.5p, when he first bought in, to last weeks close of 83.5p. At 12.15 the shares were unchanged at 83.50p from Friday's close.

Saturday's Daily Mail reported that shares in CMS WebView (CWV) "have taken off since Luke Ahern, formerly with Seymour Pierce, and his merry men at Corporate Synergy became company broker." At 12.17 the shares were up by 0.25p from Friday's close to 9.50p.

CybIT's (CYH) fundraising featured in the Weekend FT's 'small cap briefing' section. The Company has raised £4.85m net of expenses through a Placing at 3p. The funds are to be used for further expansion and to enable it to reduce its reliance on third party funding deals. The shares have had a run up on the back of deals with Signature and Vanguard, both mobile telecoms companies and with Lex Vehicle Leasing. The shares from Friday's close were off by 0.20p to 3.50p at 12.16.

The Financial Mail on Sunday reveals details of Hot Group's (HOT.L) acquisition of London-based ITN for £5.5m. This morning's announcement (see link below) confirms the deal, which according to the newspaper will see the Company become one of Britain's biggest online recruitment operations and make its first move into the education sector. The ITN deal is Hot's third deal in the past four months. ITN was set up nearly three years ago to help schools meet the shortage of qualified staff and currently supplies teachers to schools in 30 London boroughs. The paper also noted that in the year to last December, ITN recorded profits of £645,000 on a turnover of £6.4m. This morning's news appears to have attracted further interest, as the shares were ahead by 1.50p from Friday's close at 21p at 12.16.

Sibir Energy (SBE) comes under the spotlight in the Weekend's FT. "Despite general concerns about investing in Russia, Sibir Energy's prospects are improving" it noted. Resolution of a row with the energy ministry, the commitment by Shell to invest $1bn, finalisation of a Moscow refinery joint-venture with the city of Moscow and an oversubscribed share issue are the key events the paper picked up on. It suggest that if analysts valuations of 28p are anything to go by the shares "may have further to go." At 12.17 the shares were unchanged at 16p from Friday's close.

A deal with RES, a Brazilian distributor specialising in biodegradable products, saw the shares in Symphony Plastic Technologies (SYM) move ahead on Friday, reported the Weekend FT. The Company will supply RES with an unlimited amount of d2w additive, which leads plastics exposed to heat and sunlight to break up into and carbon dust. The deal guarantees delivery of 25 tonnes additive this year, enough to make 850 tonnes of finished product, which the Comapy considers to be a minimum. Symphony is looking to work with manufacturers abroad in the use of d2w, with the aim of making a margin on the sale of the additive and also taking a royalty payment on the plastic bags produced. The deal, according to the newspaper, equates to £1m of revenue for RES, of which Symphony will get a proportion. At 12.16 the shares were unchanged at 28.75p from Friday's close.

Talk of a deal with Orange in the near future helped Toad's (TOA.L) shares move forward, Saturday's Independent reported. It added that back in September, it signed a hands free mobile phone installation agreement with Vodafone, which "caused Toad shares to leap." At 12.17 the shares stood at 18p, up 1p from Friday's close.

Monday's FT has a feature on the telematics market in which Vianet (VIA) is highlighted. The article noted, "Vianet [is] coming at the market from a different angle" by focusing on vending machines. Their technology allows for machines to be monitored, with data being sent back to a central collection point and alerting managers to stock levels and breakdowns. Initially, take up of the technology was hindered by the conversion of vending machines in Europe to the new euro coins, but three recent deals, with Alcatel, Selecta, part of the Compass group and Red Bull imply that things are turning round, the FT adds. The potential market could be enormous, as estimates reported by the paper suggest that there will be approaching 7m vending across Europe by the end of the year with sales of more than Euro 25bn. However, Europe has only half the number of vending machines per 1,000 of the population compared with the US. The shares at 12.16 were up by 0.25p at 7.13p from Friday's 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.

Country & Metropolitan (CRY.L) Annual Report & Accounts.
Fairplace Consulting (FCO.L) Result of AGM.
Honeygrove Group (HYG) Result of EGM.
Hot Group (HOT.L) Acquisition and Preliminary Results.
Offshore Telecom (OST.L) Acquisition and Board Appointment.
Paramount (PMN.L) AGM Statement.
Proactive Sports (PAS.L) - Holdings in Company.
Scipher (SIP.L) - Appointment of new CEO.

Look Out For This Week

Nov 10, Monday - Hot Group (F), UK Retail sales monitor (Oct), producer prices Index (Oct).
Nov 11, Tuesday - UK CBI regional trends.
Nov 12, Wednesday - UK labour market report (Oct), Inflation report (Q4).
Nov 13, Thursday - UK house-building statistics, US trade balance.
Nov 14, Friday - US retail sales (Oct), industrial production (Oct).

The next Penny Share Review will be posted on Monday, 17 November 2003.

Compiled by A McLintock

Penny Shares Online - penny shares research and information service.