PROACTIVE NEWS SUMMARY: ValiRx, Amphion Innovations, Connemara Mining, Toledo Mining, Probability

Three of today’s main stories by Proactive Investors were dedicated to ValiRx (LON:VAL), Amphion Innovations (LON:AMP) and Connemara Mining (LON:CON), which emerged among the top performers in London markets.

Connemara surged 17 percent this morning after the company secured a partner for the Mine River block in Ireland, which is prospective for both base metals and gold.

The company has entered a joint venture agreement with Canadian group Hendrick Resources to explore the Mine River project, which includes a group of four contiguous prospecting licences covering an area of around 130 square kilometres (sq km).

Abundant mineralised float samples with gold results up to 52.18 grammes per tonne (g/t) have been found on the licence block, particularly around the Tombreen and Knocknalour area.

Previous exploration has discovered significant gold occurrences in rocks and rivers in the area of the Mine River licence block.

Under the terms of the agreeement, Hendrick will spend €500,000 to earn a 50 percent interest in the licences and has the option to spend a further €500,000 to increase its stake to 75 percent of the joint venture.

Broker Optiva said the joint venture adds a new dimension to a story seen previously as a zinc/lead play.

“The discovery of over 1 million ounces of gold by Conroy Gold and Natural Resources further to the north shows what can be achieved,” said Optiva.

“We continue to believe a market cap of £2.4 mln is simply too low for a situation that provides investors with exposure to the Stonepark zinc discoveries that lie adjacent to Xstrata’s Pallas Green deposit containing 25 mln tonnes of 9 per cent combined zinc/lead,” Optiva added.

Shares in ValiRx did even better, soaring 35 percent after the unexpected news that a newly acquired screening product for skin cancer had been granted a European patent.

The test is for a biomarker, called NAV3, which is part of an already ‘well-developed’ test kit.

Landing the patent means that ValiRx can start marketing the product to the oncology research industry and fellow drug developers, while planning a larger product launch into the wider market.

The news sparked an exciting period of trading on the AIM market with around 140 million shares, or 14 per cent of the company, changing hands by lunchtime.

ValiRx said the news strongly vindicates the decision to acquire Finland based Pharmatest, which it secured last month in a deal worth £137,000.

As part of the deal, ValiRx’s newly established ValiFinn acquired intellectual property relating to a number of biomarker discoveries, all of which were in the process of being patented.

Today’s patent news about one of these discoveries is unexpected bonus, ValiRx director George Morris told Proactive Investors.

He explained that the idea behind the Pharmatest acquisition was to take control of the biomarker discovery business for its own purposes, rather than Pharmatest’s existing IP.

“We’ve been doing our own biomarker research, up there in Finland, in respect of our lead cancer drug compounds for use in clinical trials in therapeutic use,” he said.

Moving to Amphion, the group gains 15 percent in morning trade following positive news about its ‘402’ US patents that have been re-examined by the United States Patent and Trademark Office (USPTO).

DataTern Inc, Amphion’s wholly-owned intellectual property business, has received confirmation that 20 of its original claims can be patented. It has also clarified three patent claims that were added during the re-examination process.

The group has been working to reinforce its IP position in recent years. In 2009, it had its group of ‘501’ patents re-examined and approved – this kept all original patents intact and added 26 new ones.

It says today’s determination by the USPTO is an important part of the further validation of the group’s outstanding patents.

"This outcome is an important validation of the strength of DataTern’s IP,” said Amphion chief executive Richard Morgan.

“Both key patents 402 and 502 have now been re-examined by the USPTO with positive outcomes.”

DataTern said that the positive outcomes for both the ‘402’ and ‘502’ patent re-examinations increases its confidence in the fundamental strength of the technologies and patents. 

Furthermore, Ampion explained that DataTern is currently enforcing its patents against companies that are using the patented technology without permission.

“The result is another important milestone for the development of our IP program with our new legal partners McCarter & English LLP.

“We look forward with increased confidence to positive results in the existing cases and gaining additional licensing revenues from these and other companies using our technology in the future."

Another article took a close look at Toledo Mining (LON:TMC), whose chief executive Victor Kolesnikov set out his blueprint for the miner in a 20-page presentation delivered towards the end of last year.

However, it was summed up in six words at the bottom of the first page that revealed this was a company with a “new vision, new strategy (and) new potential”.

Evidence of this metamorphosis was seen in May last year when production restarted at the mothballed Berong nickel mine on Palawan Island in the Philippines.

Where it used to export a 1.5 per cent nickel laterite to the Queensland Nickel plant in Australia, the objective since re-opening has been to concentrate on shipping high grade ore of 1.8 per cent direct to China.

The strategy has been aided by a change in the market dynamics for laterite nickel, prompted by the way China consumes and, more importantly, processes the ore.

The net effect is that 1.8 per cent laterite nickel is now considered high-grade compared with 2.2 per cent previously, creating a ready market for Berong output.

In total, six shipments were made last year totalling 315,000 wet metric tonnes, which are expected to generate revenues of US$13.8 million.

The target this year is to export 750,000 tonnes, while an engineering company has been employed to look at the constraints on shipping with a view to eventually pushing annual output above 1 million tonnes.

The current set-up, which sees ore barged from the shore to giant ocean-going vessels anchored in deeper water, is affected by sea swells, which make shipping impossible for around four months a year.

This time isn’t wasted as it is used to stockpile ore ready for export once the shipping window re-opens.

Toledo has a 56.1 per cent economic interest in Berong Nickel Corporation (BNC), whose other investors are ENK and Atlas.  BNC has three nickel deposits on Palawan Island: Berong, Moorsom and Long Point.

And there’s Ipilan, where the company’s economic interest is 52 per cent, with the remainder held by Celestial and Brooks Nickel.

The project is the subject of a bid from Jinchuan Group of China, which recently asked for more time to carry out due diligence on the property.

“We are not surprised the exclusivity period has been extended; this is the case with most Chinese transactions due to the rigorous approval process in China,” said Duncan Hughes, an analyst with the City broker Ambrian Capital.

Toledo will receive US$17.4 million if the deal goes ahead. However the focus for the company and its partners is Berong, where the aim is to generate enough cashflow to exploit the potential of the asset.

And Berong has huge potential. There is an historic resource of 3.6 million tonnes of contained nickel, according to Ambrian, which would make it one of the world’s largest nickel deposits. However it will require significant drilling to prove it up to modern-day JORC standards.

Permitting is required and could take up to a year, according to Kolesnikov. The drilling might then take another 12 months.

“We hope in two or three years to have a JORC-standard resource on Berong,” said Kolesnikov.

Today’s research reports included a note on gaming software specialist Probability (LON:PBTY) from broker Numis, which said the group would be a logical partner for Facebook as the social media giant seeks to boost its mobile revenues.

Facebook filed its listing documents yesterday ahead of an IPO that could value the company at US$100 billion.

The documents showed that nearly half of its monthly active users access Facebook through mobile devices, but at present the group does not generate any ad revenue in part because mobile screens are considered too small by advertisers.

Numis sees one way for the social media group to monetise this customer base is to permit gaming.

The broker said Facebook met up with gaming companies in Europe before Christmas and though it did not name which companies it saw, Numis believes Probability would be a logical choice if it decided to go ahead with mobile gaming.

Probability’s customers are largely people who gamble only on mobile and as the number of smartphones grows so does the appeal of providing gambling on mobiles, Numis added.