SMALL CAP MOVERS: Sureserve accepts private equity takeover bid

It happens that Sureserve is to join the growing list of companies delisting in London after agreeing to a takeover of pan-European private equity group Cap10.

A new vehicle formed by Cap10 will pay 125 pence per share in cash, valuing Sureserve, an AIM-listed social housing maintenance specialist, at £214 million, a 39 per cent premium over Thursday’s closing price.

Worryingly for AIM, Sureserve said going public will give it the right access to capital or financing, allowing it to grow organically through acquisitions and organic growth.

These are all things the junior market is set up for.

Sureserve will join the likes of Network International, THG, John Wood Group, and Industrials REIT, all of whom have jumped on the take-private train, driven by dry powder rich private equity funds.

Sureserve’s board recommended the deal, with two of the largest shareholders, Harwood Capital and Miren Rawlings, speaking for 23.4 percent, accepting the offer.

Based in Dartford, Sureserve provides gas and heating inspection, installation and maintenance services to social housing groups, with the aim of making housing stock and buildings more energy efficientx.

The company was originally listed on the main market in 2015, but switched to AIM in 2017.

Sureserve rose rapidly after the acquisition announcement, rising more than 37 percent to 123 pence, just below the valuation of Cap10’s offer.

In heavy industries British oil and gas was also on a tear at the end of the week, rising more than 15 percent after reporting oil shows at the Pinarova-1 well in Turkey, where drilling will continue after a testing phase.

Testing is expected to take place over the coming weekend, though UKOG warned it could be affected by the end of Ramadan on Thursday and affect timing over the weekend.

Explorer with small capitals Unicorn Mineral Resources plc saw its share price rise more than 20 per cent to 7 pence following news that it has been granted a license to drill at its Kilmallock project in Ireland’s Limerick basin.

Commenting on the license won, CEO Richard O’Shea said, “I look forward to an active exploration program and good news for shareholders in the coming years.”

On the bearish side of the resource sector, Echo Energy plc plummeted more than 50 percent after the company signaled a drop in production at its Santa Cruz Sur assets in Argentina.

Echo also said it is currently considering a proposal from a major Argentine investor to inject cash and assets into the company, while the board explores financing options to secure additional working capital resources.

Gas exploration company IOG plc also had a tough week, having wiped out a quarter of its market cap after reporting pressure issues and an influx of non-commercial volumes of gas into the Blythe-2 drilling program, which are expected to cause delays.

The gas comes from a reservoir that is not the target of the well and remains isolated and segregated, according to IOG.

Switching to the medical technology sector, Kromek Group plc was by far the top AIM performer, up more than 57 percent to 8.37 pence, and with good reason.

On Tuesday, Kromek announced a seven-year contract with a leading medical imaging manufacturer to integrate the group’s cadmium zinc telluride-based detector technology into customer medical imaging scanners. Analysts from housing broker finnCap spoke of a ‘groundbreaking’ contract.

The next day, Kromek announced another major contract, this time to integrate its technology into medical imaging and security scanners with CT scanning specialist Analogic Corporation.

Cancer therapy developer Advanced Oncotherapy plc also ripped more than 50 percent higher after announcing a potential listing on Nasdaq.

To make this happen, Advanced Onco has begun exploring all available options “including a possible sale to NASDAQ-listed commercial vehicles” and has therefore begun a formal sales process.

Shares of Advanced Onco traded hands Friday afternoon for 3.98 pence with a market capitalization of £21 million.

Wrapping up this week’s roundup with a little dimwit, forestry and timber trade group Wood wood said it was “appalled” to receive notice from lender Sydbank that it was terminating the US$6 million debt facility Woodbois’ Danish subsidiary Woodgroup ApS.

Sydbank cited Woodgroup’s first-quarter losses as justification for the termination, but in a statement, Woodbois said: “Management disagrees with Sydbank’s conclusion and while acknowledging its poor performance in the first quarter, felt that the company had done well. positioned to deliver a very positive performance for the remainder of the year.”

Either way, shares were cut 60 percent lower to 0.38 pence as a result.

The AIM All-Shares Index closed the week half a percent lower, underperforming the FTSE 100 and FTSE 350 indices, which both closed about half a percent higher.