SMALL CAP MOVERS: Panmure Gordon eyes up FinnCap; Sondrel rises on market debut

Two of the city’s most flamboyant and controversial characters returned to the small-cap scene this week as an AIM-focused broker FinnCap was in the crosshairs of fellow real estate agent Panmure Gordon.

Panmure Gordon, a 146-year-old London real estate institution, was acquired by former Barclays chief Bob Diamond, who subsequently appointed his former right-hand man Rich Ricci as CEO of the company.

As Barclays’ great swingers in the early 2010s, “Diamond Bob” and Ricci garnered a reputation for their eccentric personalities (and smart outfits), eye-watering bonuses and a string of controversies.

In 2012, Barclays overseen by Diamond was fined £290 million for a ‘serious, widespread’ role in manipulating interest rates as part of the Libor scandal.

Diamond would resign from Barclays after the fallout from the scandal; Ricci would retire shortly after.

Ricci also coordinated Barclays’ acquisition of the Lehman Brothers, giving Barclays a lucrative position on Wall Street for a bargain price of $250 million (a fraction of the $4 billion Diamond was willing to pay before Lehman’s collapse).

Now, as regulators at Panmure Gordon, they have the financial backing of the Qatari royal family – who is a majority shareholder in the company.

While discussions are still at an early stage, FinnCap has confirmed speculation that the company has received “indicative non-binding proposals from Panmure Gordon regarding a potential combination of the two companies structured as the cash acquisition”.

As per city code regulations, Panmure Gordon must now submit a formal intent to bid for FinnCap.

The news comes as small and medium-sized city brokers face a crisis amid a dried-up London IPO market, though Friday was a rare occasion for this year’s AIM market, as a company has indeed floated.

Specifically, Sondrel Holdings, a fabless semiconductor designer, listed under the SND ticker.

While it’s a surprising time for an IPO, let alone in the volatile semiconductor space, Sondrel is seeking funds to hire new engineers and expand its US presence.

The company raised £20 million through the issuance of 36.4 million shares at a price of 55 pence each, adding that it had received “strong support” from institutional investors. Shares rose to 58p in early trades.

Foreign exchange specialist Alpha FX group also rose more than 10 percent after news that full-year earnings are expected to be “materially higher” than expectations.

“Our proven currency risk management strategy remains successful within the current macroeconomic environment and we remain committed to ensuring that our clients are properly advised, while continuing to manage our own risk profile,” said founder and CEO Morgan Tilbrook.

Victoria also moved in the right direction after the fabric manufacturer and supplier acquired Florida-based International Wholesale Tile for $28.5 million. Shares rose 11 percent to 504p Friday.

Overall, it was a tough week for the junior market and top stocks fell on the back of uncertainty and political chaos in the UK.

The AIM 100 index’s 0.63 percent drop to 3,709 was at least outperforming the FTSE 100.

Among the fallers North Sea gas operator IOG lost more than half of its market value after a significant cut in its manufacturing guidelines.

Major management changes were announced on Wednesday, including the departures of chief executive Andrew Hockey and chief operating officer David Gibson.

Shares fell to 8.2p from 18.7p but have since recovered to just above 11p.

Another warrior was boowhere shares fell 5.5 percent to 38p Friday, while the online clothing retailer struggles with lowered forecasts as the sector faces macro pressures.

Deutsche Bank downgraded Boohoo’s rating from ‘buy’ to ‘hold’ after lowering its target price of 140p from 140p to 36p, stating: “Our view that online sales would return to structural growth after a year of normalization after COVID was wrong.

“We underestimated the impact of inflation on consumer, business costs and valuations.”