Small Talk: Investors boo performance of Bollywood film producer

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The Independent Online

after the success of the Mumbai-based film Slumdog Millionaire, cinephiles can expect an increase in the popularity of all things Indian from film studios.

On the Alternative Investment Market (Aim) there is an altogether different film drama playing out. A listed Bollywood film producer has been hogging the limelight on the growth market, unfortunately not for the same reasons as Slumdog. Investors in The Indian Film Company think its financial performance has hardly been Oscar-worthy in recent months, and a simmering row blew up into open warfare in January.

The company has been in dispute with the IFC Requisition Group (IFCRG), a band of disgruntled shareholders who hold about 30 per cent of the register. Those booing from the stalls include the hedge fund Altima Partners, which owns 14.4 per cent of the company.

IFCRG's beef was, bluntly, that the group was directionless and could be managed in a much more efficient way. It was underperforming against its rivals, the shareholders said, and they demanded the removal of Indian Film's founder, chief executive and 21.6 per cent shareholder, Raghav Bahl.

The crackling thriller in the making has now rather fizzled out, and Mr Bahl remains in command. However, the group announced at the end of last week that it has agreed to take on two new non-executive directors and conduct a strategic review as an olive branch to investors. One of the new directors is acting on behalf IFCRG, and all parties now insist that they are happy with the outcome. There are no plans for a sequel to the row, but watch this space.



Tepnel Life Sciences

The biotech market is never a great place to be during a downturn. The problem stems from most companies burning through the cash faster than they can find it, and 2009 is expected to see a number of sector companies go to the wall.

There are a few rays of light. Tepnel Life Sciences, which specialises in molecular diagnostics, has seen its share price jump by 137.7 per cent in the last year on the back of several bits of good news. Best of all for shareholders was the announcement on Friday that the company has agreed to be bought by the US group Gen-Probe, a Californian Nasdaq-listed company. Gen-Probe says it specialises in "the development, manufacture and marketing of rapid, accurate and cost-effective nucleic acid probe-based products used primarily for the clinical diagnosis of human diseases and for screening donated human blood". So now you know.

The good news for Tepnel shareholders is the amount Gen-Probe is paying. At 27.1p a share, or £92.8m, the offer is 126 per cent above the closing price of the stock on the day before the initial approach on 21 January.

Ben Matzilevich, Tepnel's chief executive, was in no doubt that the deal was a stellar result for shareholders: "We believe Gen-Probe's offer represents significant value for Tepnel shareholders and recognises both our past achievements and our future potential in molecular diagnostics and pharmaceutical services."



DiamondCorp

Diamonds might be a girl's best friend, but they have not been particularly welcomed by investors in the last year or so. The global recession has taken its toll on the diamond market like any others, with Aim-listed DiamondCorp's share price tumbling 65.8 per cent in the last 12 months. Even investment by the European Islamic Investment Bank, which now owns 26 per cent of the group, has done little to arrest the share price slide.

There was better news on Friday when the group announced that it had started pulling up ore from its mine known as the Lace Project in South Africa, although even that did little to stimulate the share price, with the stock closing flat on Friday at 32p a share.

In fairness to the company, there are reasons to be excited about its prospects, despite Aim-listed miners enduring a pretty miserable time of it in recent months. Chief executive Paul London recognises that there are problems with the diamond market, but argues that the underground kimberlite at the site could be profitable despite the depressed market prices: "The worldwide economic downturn has impacted significantly on the diamond market, with prices received for Lace diamonds falling 50 per cent during the fourth quarter of 2008. The accelerated phase two development programme targets kimberlite with the potential for profit at these lower prices."

The problem for all small-cap miners is that the market doesn't trust the sector with any of its money until results are tangible. Mr London's argument may be sound, but he will have to start producing before the shares will feel the benefits.

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