UK small caps open easier, with Oxon weak on fundraising warning

UK small caps open easier, with Oxon weak on fundraising warning

	Published : Wed, 06 Jun 2007 09:37 By : Agencies Print this Story

LONDON (Thomson Financial) - UK small caps were easier in early trade, reflecting weakness in the wider market, with Oxonica resuming trading sharply lower amid fears of a major cash call, dealers said.

The FTSE Small Cap index was 2.3 points off at 4,205.3 by 9.17 am, while the FTSE 100 was 29.6 lower at 6,603.2.

Oxonica resumed trading at 50 pence, down 67-1/2, or 57 pct, after the company warned it will require raising additional funds in the coming months through an equity offering.

The group and Petrol Ofisi have decided not to continue to invest in demonstrating the performance of Envirox in high-sulphur fuel. However, they intend to continue to work together to evaluate the potential for the use of Envirox in low-sulphur diesel fuel which will become the primary road transport fuel used in Turkey from July 2008.

Sellers were also about in XTL Biopharmaceuticals, 3-1/2 adrift at 14-1/4, after the company said has decided to suspend further development of XTL-2125 following a Phase 1 trial.

Sportingbet eased 1-1/2 to 54-1/4 in the wake of third-quarter numbers, with Altium reiterating its 'hold' recommendation. Recent rumours of a bid from Bwin as much as 90 pence a share seem very much on the high side, according to the broker, which believes that the stock is high enough in the absence of a bid.

Fonebak dropped 6 to 65-1/2 after the group warned it will be loss making in the current year. However, the board believes it has a deliverable plan and a clear route back to an acceptable level of profitability.

Among gainers, Asterand ticked up 0.88 to 6.25 after the supplier of high quality human tissue and tissue-based services revealed its strategy to achieve positive cashflow as soon as possible and drive sales growth.

Annualised savings from these actions are estimated to be approx 700,000 stg, subject to one off exceptional costs being incurred of around 325,000 stg in the year to Dec 31 2007.

Speculators were again active in Ceramic Fuel Cells, 3-1/2 higher at 43, amid talk that the boiler maker could have attracted a predator - namely a large white goods maker. However, some traders believe that a consortium of Middle East investors has been showing interest in the group's technology.

On the results front, Alternative Networks climbed 11-1/2 to 184 after the business-to-business communications reseller disclosed a 30 pct increase in underlying first-half pretax profits. It said it is evaluating a number of acquisition opportunities, and is well positioned to meet its full-year expectations.

Acquisition news gave a modest lift to Glen Group, 0.03 firmer at 0.50. The company has snapped up Pinnacle Group, which provides solution-driven telecommunications services to the SME market, for 700,000 stg in cash and shares.

Medical Marketing attracted support and rose 9-1/2 pence to 174-1/2 following news that an advanced pre-clinical study has shown that the company's ribozyme technology can suppress the receptors needed for HIV to enter into cells.

An operations update boosted Investika 52-1/2 to 365, while Hampson Industries celebrated bumper full-year numbers with a gain of 8, at 168.

Among the explorers, African Copper ticked up 2-1/2 to 80-1/2 after the company disclosed that drilling to the south of the Dukwe mine pit in Botswana has extended the known high-grade copper mineralisation for a further 350 metres.

The AIM-listed exploration and development company said the inclined holes showed broad intersections of mineralisation, up to 157 metres wide, with grades similar to the main Dukwe resource.

Leadcom Integrated Solutions hardened 2-1/4 to 67 as the provider of innovative telecommunication solutions revealed several new contract wins in the Central, Eastern Europe, Middle East, Africa region with an aggregated value of 21.5 mln usd.

Finally, A duo of newcomers managed solid premiums as trading got underway on AIM. Shares in Globus Maritime, which owns and operates a fleet of dry bulk vessels that transport dry bulk cargoes, started life at 324 pence, up from a placing price of 300.

Pressure Technologies climbed from a placing price of 150 to 167-1/2. Pressure Technologies is the holding company for Chesterfield Special Cylinders, which designs, manufactures and offers testing and refurbishment services for a range of speciality high pressure, seamless steel gas cylinders for global energy and defence markets.

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