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Penny Share Review 240

Monday 21 June 2004

The Daily Express from Saturday wrote that there was a "buzz" around Desire Petroleum (DES) amid mounting speculation of positive news on its Falkland Islands oil prospect. According to the paper the Company is said to be close to identifying major drilling targets and is talking to companies about farming out acreage. This had a knock-on effect on Greenwich Resources (GRWA) the Express noted, as it has about a 4% holding in Desire. The Company this morning attempted to play down some of the weekend's comment (see announcement below). Despite this Desire's shares were up by 0.75p from Friday's close at 26.75p, while Greenwich had put on 0.25p to reach 3.00p.

Itrain (IRN.L) features in Saturday's Daily Mail's 'Broker Buys' section. The broker in question is Corporate Synergy who recommended to 'buy' at 8p, as current trading has maintained impressive momentum and the it is a growth story that remains intact. The shares were up by 0.25p from Friday's close to stand at 9.75p.

Mean Fiddler (MEF.L) Chairman Vince Power is the subject of Saturday's Independent's Business Interview. Mr Power believes that Glastonbury has become a "national brand" and an established part of the middle class's social calendar. The festival's popularity is exemplified by the 25m hits that the Internet ticket sales system took earlier in the year. Demand for experiencing live music in the UK is still growing, but Power suggests that the festivals scene "is pretty much saturated now in the UK". This has led to expansion into Europe, especially Spain and Germany. He is also planning a string of open-air gigs aimed at more specialist audiences and at promoting the Jazz Café brand. However, it is the prospects for the group's live music downloads business that is expected to drive growth. Mr Power rejects suggestion that he should take the Company private and wants the City to realise the company is entering a new era. The shares moved ahead by 0.50p in this morning's trading and stood at 54.40p.

The approach by Paramount's (PMN.L) management made it into most of the weekend's papers. Saturday's Times reported that the offer could be at a price up to 35p a share and is at a very preliminary stage. This would value the Company at £28m. Paramount was forced to make an announcement after takeover rumours sent the shares up by 20% in the past week. Nick Basing, the chief executive, who was brought in to head the business in April last year after its acquisition by JO Hambro, is leading the buyout team. Mr Basing is in discussions, according to The Times, with private equity firms to finance his bid and although no backer has yet been signed up he is confident of securing the equity and debt needed to fund a takeover. The shares were unchanged from Friday's close at 34p.

Saturday's Times runs the rule over Petrel Resources (PET) and picks up on the news that the Company had submitted the third of three tenders to the Iraqi Ministry of Oil. Petrel is looking to develop three oilfields in Iraq, which it believes, despite the apparent danger, present a great opportunity, as it has a local workforce and a non-political profile in Iraq. Moreover, the major companies are wary of getting involved. The shares were up by 1.50p and had reached 40.75p in Monday morning's trading.

According to Saturday's Daily Mail, a mention on the WhatsHot.com website fuelled heavy buying in Toledo Copper (TCU.L) on Friday. It appears that the news of the financing agreement to develop the copper mine, which was released by Atlas Consolidated Mining & Development Corp last week, is percolating through the market. We may not have to wait long for official news from the Company itself about developments in the Philippines. The shares were unchanged from Friday's close at 2.25p.

Derek Pain, one of Saturday's Independent's private investor diarists, features Wigmore (WGT.L), as he highlights the vulnerability of smallcap shares. He reviews recent events and noted that two slow trading quarters attracted the attention of its bank, despite having an encouraging order book and a terribly dilutive fundraising was undertaken. However, according to Mr Pain Wigmore should survive, but it has "lost the ebullient image that once made it such a promising player on the small-cap stage." The shares were unchanged from Friday's close and stood at 0.43p.

NB: The prices quoted above were taken on or around 11 am on Monday 21 June 2004.

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.

Desire Petroleum (DES) - Statement on Press Comment.
Interregnum (ITR.L) - Portfolio Company Developments.
Oxford BioMedica (OXB) - Scientific Update.
Raft International (RFT) - Significant contract win.
Sectorguard (SGD) - Interim results.
Ten Alps Communications (TAL) - Final results.
Virotec International (VTI) - Director Change.

Look out for this week

Monday, 21 June - Sectorguard (I), Ten Alps Communications (F).
Tuesday, 22 June - nothing of note.
Wednesday, 22 June - CybIT (F), UK MPB meeting minutes.
Thursday, 23 June - UK CBI industrial trends (Jun).
Friday, 24 June - UK BBA mortgage lending (May), US GDP (Q1).

The next Penny Share Review will be posted on Monday, 28 June 2004. Compiled by Andrew McLintock

Penny Shares Online - penny shares research and information service.