JITTERY investors offloaded Stanelco as the developer of biodegradable packaging, one of London’s best small-cap performers last year, unveiled plans for a rescue refinancing.
The Southampton-based company saw its shares rise from 5½p to 28½p in the first five months of 2005, valuing its equity at £250 million, as shareholders latched on to the potential of a big-ticket licensing deal for its packaging machines with a food retailer such as Asda. But that valuation appeared heady for a company with almost no revenues, and the shares have steadily drifted lower as hoped-for contracts failed to emerge.
Yesterday Stanelco, which raised £3.1 million at 8.1p in June, said that it had cash for only a further three months, and conceded it is “exploring all financing options”, including an equity issue. The shares fell 21 per cent, or 1.1p, to 4.1p.
It was GCAP Media that proved the speculative focus of the mid-cap session, with the Capital Radio owner gaining 16¾p to 208¼p on revived rumours of private equity interest. Financial buyers were also said to be stalking Blacks Leisure, the outdoor equipment retailer, 19p better at 446p. More conviction appeared to lie behind suggestions that a firm offer of at least 90p has been tabled for Monstermob Group, up 20p to 86p, the mobile phone content provider which had admitted to a bid approach last week.
Elsewhere, an £89 million bid for Baggeridge Brick from Austria’s Wienerberger fuelled hopes that the consolidation of what remains of Britain’s building materials sector cannot be far away. Marshalls, the paving slab maker, improved 9¾p to 327p, with Michelmersh Brick 3p better at 117½p.
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ISoft Group dipped ½p to 48½p as Sheffield’s hospital trust abandoned an implementation of the company’s patient administration software. Gyrus Group, the maker of medical devices, stood out with an 11¼p rise to 363p, despite its exposure to a weak dollar, amid talk of US predatory interest.
Wolverhampton & Dudley Breweries shed 8p to £13.55 amid word that it is quietly seeking buyers for about 80 of its bottom-end pubs, mostly tenancies, as part of an acceleration of the normal “churning” of its estate. Analysts say the pubs could be worth up to £30 million. Gulf Keystone Petroleum, which recently signed BG Group as a partner in Algeria, shed 2¾p to 62¼p on raising £13.4 million at 62p.