Site revaluation holds key to Lok'nStore's future

Small Companies Notebook
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The Independent Online

Lok'nStore, One of the self-storage warehouse groups that have sprung up over the past decade, is about to reveal another weapon in its battle to stop being taken over on the cheap.

Lok'nStore, One of the self-storage warehouse groups that have sprung up over the past decade, is about to reveal another weapon in its battle to stop being taken over on the cheap.

The company, which has 16 distinctive blue and orange warehouses around the UK, rejected a £33m takeover approach earlier this year. Interim results tomorrow will be accompanied by a revaluation of the company's property portfolio, which is currently on the books at cost price, £8.3m. Independent valuers have been examining the sites - a couple of which have already been boosted in value by permission to develop them for housing - and word from the analyst community is that their real value is more than double the published figure, about £20m.

Lok'nStore and its rivals offer a temporary home for the excess stuff accumulated by businesses and individuals, but the industry has failed to take off in the UK at the same speed as in the US, and competition is fierce. With more consolidation on the cards, many in the City expect Lok'nStore to attract another suitor soon, but it wants to stay independent. As well as a portfolio revaluation "to provide guidance for shareholders", the company is also considering a share buy-back.

Roshni Investments

Put a cash shell to your ear, and what do you hear? In the case of Roshni Investments, gossips are hearing that a £2.5m fundraising is well underway and that the group has identified a Midlands-based telecoms company as its first acquisition, a profitable business that makes money from connecting mobile calls to landlines. Nice to see a cash shell getting on with things quickly: Roshni listed on AIM less than a fortnight ago, raising £185,000 to cover administrative costs. The company is chaired by Nigel Robertson, who founded the directories business Scoot.com and who is now something of a serial chairman, with gaming and cosmetics firms to his name but not, any longer, Corvus Capital, which is in the middle of a reverse takeover and from which he unexpectedly resigned last week.

Northern Dynasty

Cold, but full of gold. Alaska. A Canadian company called Northern Dynasty Minerals last week completed a C$22m (£9m) fundraising to pay for the establishment of a mine at Pebble, Alaska, where it is sitting on a big copper and gold deposit. Northern Dynasty's largest shareholder is Galahad Gold, which is listed on AIM and which took up £4.7m of the shares issued. This week, Galahad is expected to tap its own shareholders for £7m in a placing at a modest discount to Friday's closing share price of 15p. That fundraising will recover the cash it has just sent out to Canada, and also pay for exercising options over more Northern Dynasty shares. Galahad could end up owning 35 per cent.

QXL

What's the best performing main market share of the year to date? It is a blast from the dot.com past, QXL Ricardo, the loss-making online auction house that looked as if it would be wiped out by competition from the mighty eBay. As surprising as the three-fold increase in the share price on a single day in January - when QXL said it would not have to sell assets or new shares to stay in business - has been the fact that the shares have stayed at the new high level. Although the company is now so small it is below the radar of most equity analysts, a few have been in to see management over the past few weeks and emerged cheered by what they have heard. Apparently, sales in Denmark and Norway, where eBay is not present, continue to grow, while in Switzerland eBay has failed to progress much beyond a market share of 30 per cent. There is talk of QXL breaking even at the end of this year. That really would be a turnaround.

Air Music & Media

Word is Air Music & Media, one of the minnows of the junior stock market, has a bullish trading statement ready for publication. There will always be a market for the Greatest Hits of Dave Dee, Dozy, Beaky, Mick & Titch, it seems. Air owns a string of record labels and, in total, a collection of 100,000 easy listening or nostalgic tracks, and sells low-price CDs, tapes and DVDs, mainly to music wholesalers or distributors. Recent acquisitions have performed particularly well, Air is expected to say. The company is chaired by the serial entrepreneur John French, who is also behind Croma, a surveillance equipment group, and Claims People, the loss adjusters.

Tikit

An ambitious company, Tikit. The little software group is going to be 10 years old in a few weeks and the group is hoping to get back on the acquisition trail soon, buying in some of the little consultancies that work elsewhere in its niche: document management and web-based software services for the UK's big law firms. Results on Budget Day last week showed profits more than doubled in 2003 and the company has a record order book. Its broker, Charles Stanley, boosted forecasts for the coming year in an investment note that has excited some fund managers. With stuffy law firms feeling confident enough to start spending again, this specialist company is being tipped as one to watch.

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