Last week we covered a rare occurrence in the 2023 small-cap scene: A premium share valuation. Specifically, Searchlight’s £470mln bid for Gresham House at a 63% premium of 1,105p per share.
In stark contrast, this week we saw WH Ireland Group PLC (AIM:WHI), the small-cap broker and wealth manager, seek out an emergency £5mln fundraiser to keep its head above water.
At 3p per share, that makes for a shocking 87% discount to Thursday’s closing price.
It really has been annus horribilis for small-cap brokers this year, what with finnCap and Cenkos, two stalwarts of the London scene, agreeing to merge lest they fall into irrelevance.
WH Ireland’s bargain-bin offer comes off the back of a prolonged decline in transactional activity in the capital markets combined with a reduction in assets under management
The I word has been bandied about (insolvency, that is). In response, WH Ireland shares tumbled 60% to 8.44p, at the time of writing, though one wonders if there is further downside to come to match the discount share offer.
AIM's late-week bounce
The wider AIM All-Share Index stayed essentially flat across the week, though a peak of 770 on Thursday afternoon marked a half a percentage point gain on Monday’s open at 766.
This late-week swell coincided with a strong showing on the New York Stock Exchange following a press dovish-sounded Federal Open Market Committee gathering.
Though the Fed went for another 25 basis point rate hike, the soft-landing narrative has gained further traction which could put a pin in future hikes.
AIM retraced these gains on Friday to close unchanged at 766.
Aferian swings higher
Among the top movers was business-to-business video streaming company Aferian PLC (AIM:AFRN), which took the premium-valuation mantle by raising US$4mln (£3.1mln) in fresh cash by issuing new shares at around a 20% premium.
This good yet surprising news sent the AIM-quoted group’s share 60% higher to 16p apiece.
Brighton Pier Group, owner of the iconic seaside attraction, staged a bit of a recovery after plummeting 33% to 28p at the start of the week on the back of a gloomy trading update.
The company said it faced increasing economic pressure due to a decrease in disposable incomes and consumer confidence, which led to sales lagging behind 2022's numbers.
Since Tuesday, shares have managed to bounce back to 48.5p.
Also on the up was engineering and technical recruitment firm RTC Group PLC (AIM:RTC), which more than doubled its share price to 36.5p on Wednesday after it reported an increase in profits and revenues in the first half.
RTC, which works with Network Rail, also swung back into a profit of £1mln, after a first-half loss last year of £400,000.
Upland Resources (LSE:UPL) was a top dog In the heavy industries, surging over 40% during the week after the explorer confirmed it is now in a formal process of assessing an onshore rig capable of developing its Sarawak project in Malaysia.
Mila Resources PLC (LSE:MILA) also impressed, with shares rocketing 50% higher as investors applauded its deal allowing Aussie miner Liontown to explore for lithium on its Kathleen Valley tenements in Western Australia.
Shares in SIMEC Atlantis Energy Ltd (AIM:SAE, OTC:SMAYF) surged 40% as the company's restructuring efforts began to pay off, according to its final results for the year ended 31 December 2022.
The company reported a significant reduction in group losses to £11.1mln, down from £74.1mln in 2021, driven by a £5.0mln decrease in operating expenses and a £2.0mln improvement in the valuation of the Uskmouth sustainable energy park.
SDX Energy had a less-favourable trading week, falling 11% after the Morocco-focussed oil and gas firm announced a convertible loan financing for working capital purposes.
Other underperformers on the junior market included household door and window supplier Safestyle UK PLC (AIM:SFE), which fell over 40% on a profit warning; staffing company Empresaria Group plc (AIM:EMR), which tanked 24% following an unfavourable trading update; and Vanquis Banking, which tumbled 32% after swinging to losses in the last interim period.