Markets: Porter gets teeth back into market

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The Independent Online
Welcome back to quoted company life for Andrew Porter, who has moved in on the dull but essential business of dentistry. Mr Porter established biotech company Alizyme - mentioned on these pages last week - where he recently took on a non-executive role. His new venture, to be called Oasis, is expected to secure a listing on Ofex, probably on 19 May. Thereafter, a move up to the AIM is anticipated. Mr Porter has already secured pounds 1m in funding to buy two dental practices and provide working capital.

While dentistry can be a lucrative profession - when was the last time you saw one down at your local dole office? - Mr Porter reckons there is plenty of scope for boosting returns in a limited company. More professional marketing and better client management and record keeping can all enhance margins. Oasis' only quoted competitor is Whitecross, which has proved a low risk, if slightly dull, investment. Further details of the offer are expected shortly.

Meanwhile, Prism Leisure, the cut-price computer games, music and video wholesaler, has launched a pilot satellite advertising campaign on Sky into Scandinavia for its CDs. If the initiative pays off, it hopes to extend the campaign across other Sky services in Europe, starting with Germany. The innovative approach may further help the shares, which have come back strongly this year, reaching an all-time high of 184.5p in March before slipping to 161.5p.

It is rumoured that results from Abacus Polar, in two weeks' time, will be better than expected. After the merger with Polar in December 1995, cost savings have made a notable impact on the bottom line for this electronic components distributor. The sector has caught a cold, especially with the problems at Premier Farnell, but the group has also had problems of its own to contend with. It failed to predict a downturn in semiconductor chip sales last year, while in October it lost an important franchise. But the shares now trade at around 15 times 1997 pre-tax profits, on a forecast pounds 10.5m from Credit Lyonnais Laing. Longer term, the prospects look positive.

This column expressed a somewhat negative opinion on Verity Group, the loudspeakers firm whose hopes are pinned on exciting new flat panel technology to produce very thin loudspeakers. At the start of last month, we suggested the shares - now at 55.75p - had lost touch with reality. So it is reassuring to see the directors heeding our advice. On Wednesday, chief executive Farad Azima sold 500,000 shares of his 11.5million holding, at 53.5p each. He was joined by fellow director, P Thomas, who sold 70,000 shares at the same price, leaving him with 204,970 shares.

The stock market liked what it saw when Capital Radio announced its acquisition of Virgin Radio in a pounds 86.7m deal. Dresdner Kleinwort Benson has upped its rating from hold to buy, while Salomon Brothers also returned the shares to its buy list. Although Virgin is unlikely to contribute until 1998, with some dilution this year, brokers see the acquisition revitalising sentiment towards Capital, with some investors disappointed at the move into restaurants, following the My Kinda Town deal.

Expect an upbeat AGM statement from Wellington Holdings on Tuesday. The chemical engineer, and the UK's largest supplier of rubber for retread tyres, is expected to make pre-tax profits of pounds 6.2m this year, rising to pounds 8.1m in 1998.

Further news from Cable & Wireless, which rose 10p to 511.5p on Friday following encouraging comment about the CITIC Hongkong Telecom stake sale. The sale by CITIC Pacific of its 7.74 per cent stake in C&W subsidiary Hongkong Telecom to China Everbright Holdings moves C&W closer to a deal with the Chinese government and removes the uncertainty over the CITIC stake, said James Ross, analyst at C&W's own broker ABN Amro Hoare Govett.

"It removes the uncertainty over what CITIC is going to do with its shares, as it has been looking to sell for some time now, and it removes part of the uncertainty about where C&W is going next in regard to Hong Kong."