We’ve got one! It’s live. M&A is not dead after all.
SNAP: Ethanol Investments: Statement re potential offer
The Company refers to its announcement made yesterday that provided an update on Ethanol Investments’ investing strategy and notes the fall today in its share price…
Go on, go on.
The Company reports that it is currently in talks with a third party which may or may not lead to an offer being made for the Company. The current discussions would suggest that any such offer would be made at a significant premium to the closing price on 10 September 2007 of…
… 0.135p!
This particularly outbreak of deal making seems to amount to about £2m, but we could not get fuller insight immediately since the lucky M&A banker on the job, Jonathan Wright of Seymour Pierce, was in a meeting.
What we do know is that on Monday, Ethanol, which seems to be a re-tread of Seymour’s many worn out shell companies, announced that its was facing a suspension of its stock on AIM on October 25 because it hadn’t managed to do the deals it promised when joining London’s junior market.
It had said in that past that it wanted to invest in a string of bio-fuel companies, but complained that most of the opportunities presented to it were priced unrealistically high.
Monday’s statement did say that directors were “currently in late stage discussion concerning a significant potential corporate transaction…,” following that up on Tuesday with news of a possible takeover.
The share price reaction? Up 0.05p to a mid-market quote of 0.135p. That’s a gain of 37 per cent, but then the bid/offer spread on this particular security stands at 0.17p if you are selling and 0.2p if you want to buy.
We’re tempted to start adding up how many of these sub-penny dreadfuls are bunging up the gutters of the London market. (Ethanol, in a previous guise, began trading at 7.5p in 2004, spiked above 16p eight months later, fell below a penny four months after that; the stock has flatlined ever since.)
Remember that SEC commissioner who caused a stink in March, saying AIM looked like a casino to him?
Roel Campos! Come back. All is forgiven.
