Beyond the Footsie: Mon close

12 April 2012

SHARES in smaller companies ended the day near session highs, bucking the weak trend among its blue chip peers, as a raft of well-received corporate news prompted solid gains in the minnows, dealers said. The FTSE Small Cap index closed 15.9p firmer at 2662.8, just off a session high of 2663.9 having spent the day in positive territory.

The overall winner of the day was troubled software supplier Cedar, whose shares soared over 35% higher to close at 4- 3/4p as investors cheered news of a rescue bid.

Redac, a takeover vehicle formed by buyout specialist Alchemy Partners said it has agreed to pay 5p-a-share for Cedar, valuing the group at £3.8m - a discount of 57% to the firm's closing price on 27 December last year, when it announced it was in takeover talks. Redac will assume the company's £38.3m debt.

Manganese Bronze was hailed by investors after news of a 20-year licensing deal with Brilliance China Automotive Holdings - worth an initial £2.7m - that will bring black cabs to China. The group also reported an 8.5% increase in sales of black cabs in the financial year since 1 August. In response, its shares were 26p firmer at 106.

Hi-tech security firm Bell Group was well-bid after ABN Amro included the group in its list of small company buys for the year and benefiting from news of an ID card contract win. The group said its smart card management unit Bell ID has won a contract to provide management software for a national identity card system in Macau. Some 500,000 ID cards will be issued to Macau residents starting this year.

The acquisition of radio licences from GWR and a weekend press tip gave a boost to UBC Media, 5 1/2p firmer at 33 1/2p, while Molins added 31p to hit 225 1/2p on news it is developing a business park.

On the downside, shares in restaurant operator Chez Gerard slumped 9p to 67 1/2p as it warned it expects to write down the value of some of its restaurants, as total sales from continuing operations in the first half fell slightly below last year.

The group said it has already closed its Livebait restaurant in Chelsea and will take a £500,000 charge in its interim results for the site.

Finally, shares in Photo-Me International closed 2p lower at 38p after the largest maker of photo booths warned that its short term outlook is 'uncertain' and said it sees no progress in the second half.

A tough first half knocked 45% off interim pre-tax profits and analysts at Cazenove were understood to have cut back their stance on the stock to 'hold' from a long-term 'buy' rating, highlighting the poor outlook for both photobooth and manufacturing operations.

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