Sierra Rutile Ltd (LON:SRX) put on a spurt in the afternoon session as the proposed merger with Iluka Investments (BVI) cleared another hurdle.
The shares advanced 4.7% to 33.5p after the German Antitrust Authority granted clearance of the merger, which should now become effective on or around 29 November.
The 36p per share cash offer from Iluka Resources values Sierra Rutile at £215mln and had been agreed by the board and a majority of shareholders.
Among FTSE 100 constituents, precious metals miners Rangold Resources Ltd (LON:RRS) and Fresnillo PLC (LON:FRES) were sitting first and third on the leader board.
Despite the continuing strength of the dollar, the price of gold – denominated in dollars – continues to head north, with a 0.5% increase today taking it up to US$1,214.50 an ounce.
Meanwhile, the rising oil price gave a boost to energy giants BP PLC (LON:BP.) and Royal Dutch Shell PLC (LON:RDSB), with the former up 1.55 and the latter up 1.3%.
Brent crude for January delivery was up 3.3% at US$48.39 a barrel today as hopes rose of an output freeze being agreed at next week’s Opec meeting.
“The initial [production freeze] deal had been thrown into doubt by the unwillingness of certain members to take part in the cut but it would appear people close to the talks remain confident. Vladimir Putin appears to be one of those that has high hopes of a deal being done which would pave the way for Russia to take similar steps,” said Craig Erlam at forex trading platform operator OANDA.
“A firm deal next week could see oil spike higher as it's currently well below the levels it reached in the weeks after the initial deal was agreed in Algiers,” he noted.
Down under in the land of BOS
Aussie software company BOS Global Holdings NL (LON:BOS) perked up this morning on news of a contract win.
The productivity solutions provider, which listed on Aim at the end of August through a reverse takeover of Forte Energy, said a distribution agreement with Ag-I Solutions would prove to be transformational for the company.
The agreement provides the company with BOS-branded market-ready products that BOS expects will generate revenue in the near term.
The agreement term is initially for three years expiring with an additional two-year option.
Shares shot up by more than a third and were the top performers in London at midday.
In other news from down the other hemisphere, Senterra Energy PLC (LON:SEN) slumped from 4.25p to 2.5p as its shares returned from a suspension of trading after the proposed takeover of Oasis Smart Sim, a sim-card technology business based in Singapore, fell through.
Senterra had been approached by a number of parties with opportunities outside that of the energy sector who have expressed interest in working with Senterra to facilitate a public listing, and the Oasis deal looked like being its preferred option, as Oasis had indicated it might stump a short-term loan.
With the collapse of the deal, the loan idea also goes out the window.
The Senterra board believes that a replacement transaction will be found and hopes to be in a position to update shareholders in the near future.
The final Frontier
It is a tricky business valuing intellectual property (IP) portfolio companies, but the market has taken the hint with LON:FIP="" plc="" rel="3501">LON:FIP).
The shares rose 5.5% in the first hour of trading on the back of full-year results that showed a 65% increase in the fair value of its portfolio companies to £4.65mln at the end of June from £2.81mln the year before.
To put that into perspective, the market currently values Frontier at just over £10.5mln. Cash balances at the end of June stood at £771,000, up from £636,000.
“I am particularly pleased to report the growth in value of our portfolio,” said Neil Crabb, the chief executive of Frontier.
“We have expanded our network of universities and have increased the size of the equity stakes we are entitled to receive. Our pipeline continues to show healthy expansion, which we expect to convert to growth in our Core Portfolio in the current financial year. We are also seeing strong commercial progress in our existing Core Portfolio, together building the potential for further uplift in value," he added.
Red Rock Resources PLC (LON:RRR) is set to receive a cash windfall of US$658,350 arising from a US$55mln dividend distribution from Jupiter Mines Limited, in which it holds a 1.2% stake.
The sum far exceeded the expectations of broker Dowgate. It had pencilled in US$110k as a base case scenario and US$165k as a best case scenario.
As a result of the latest news, which sent Red Rock’s shares surging 12.5%, is has revised upwards its estimated value of the Aim-listed firm’s equity stake in the Aussie miner. It now places a value of £8.5mln on the stake, up from £1.6mln.
Even after Red Rock’s surge today it is only valued at £2.24mln, which Dowgate notes “seems far too low, given today’s news, and maybe the prospect of other forgotten assets within the group's portfolio surprising investors with positive news in the near future, as commodity prices continue to rebound.”
Heading the other way was African Potash Ltd (LON:AFPO), which lost two-fifths of its value as its nominated adviser (nomad) resigned.
The company has until 8 December to find a replacement, otherwise its shares will be suspended from trading. If it does not find a nomad within a month of its suspension, its listing on Aim will be cancelled.