Small Companies Notebook: Chefs to get out of kitchen and heat up stock market
Monday 26 July 2004
Not content with colonising the television schedules, celebrity chefs are cooking up plans to conquer the stock market, too.
Alexander Spencer-Churchill, the young socialite and heir to the Duke of Marlborough, is on the board of a new company aiming to bring celebrity chef ready meals to the supermarket shelves of Britain. He is, not coincidentally, good mates with Marco Pierre White and word is he'll be using such connections as the company builds a collection of big name brands.
It has also alighted on at least one acquisition target which will bring in the manufacturing and distribution skills needed to get a foothold in this challenging industry.
The company, called Conival, will be chaired by Richard Thompson, the entrepreneur who considered a bid for Aston Villa earlier this year, and its chief executive - the "steady pair of hands" of the venture, according to an insider - is to be John Maundell, whose previous boardroom credits include Virtual Internet and Xworks and, currently, the telecoms tiddler Canisp and the dance music website Internet Music & Media.
Conival is initially raising £351,000 in a share placing at 3p per share. The fund raising has been carried out by WH Ireland.
Virtue's reel life
Virtue Broadcasting, which helps big companies communicate internally and with their shareholders via the web, is making a giant takeover of a film company with makes promotional and information videos for companies and non-governmental organisations. World Television Group is bigger than Virtue, and is being taken over for £18.1m in cash and Virtue shares. "World brings with it a truly impressive client base including Nestlé, Reuters and Sony, and I look forward to the coming months with increased excitement," says the chuffed chairman of Virtue, Mike Neville.
Lucas aid for Torex
Word reaches us of more success for Torex Retail, the till software company which was spun out when its parent company, Torex, merged with the healthcare software giant iSoft.
Torex Retail has been launching a new system linking store tills with head office to give retailers vital information on customers' shopping habits and the success or otherwise of in-store promotions. This next generation product, christened Lucas, is cheaper for its clients to run, Torex says, so it is optimistic about strong sales over the coming year. The City is optimistic, too, and one respected software sector analyst is planning to go live with a positive investment recommendation on Torex shares soon. Sales forecasts already in the market are likely to be beaten, he thinks, but even on current forecasts the stock looks super-cheap on barely 10 times likely 2005 earnings. The trigger for a sharp improvement in the price could well be news, within days, of a significant contract win for Lucas with an international chain of luxury goods boutiques.
Zari is a nugget
A few little nuggets of information on a gold mining outfit coming to AIM, the junior market this morning. Zari Resources does not actually own any land, any licences, any business at all. It is currently just a cash shell with an option to purchase a company in south-west Tanzania. The deal is dependent on independent geological tests showing, as hoped, that the target company, Zari Exploration, is sitting on commercial quantities of gold.
Zari Resources has sold 65 million shares at a penny apiece in a placing believed to have been several times oversubscribed. The acquisition of ZE is meant to be just the first of a string of investments in the sector.
The success of ZR's fund raising is down to the connections of the founders. Zari is chaired by Brian Moritz, the former Grant Thornton accountant who is already director of four listed mining companies, and it counts among its executives Jo Malins, the founder of Everett Financial, who is a director of three. Tanzania is already Africa's third-biggest gold exporter and the government there is being very nice to the mining industry in an attempt to leapfrog Ghana into the number two position. (You know, of course, that South Africa is No 1).
Top of the shops
The three-way merger of piped music specialists last week is just the start of consolidation in this fascinating industry.
The background music chosen by shops, shopping centres and restaurants is one vital element of "unconscious branding" as well as a way of keeping the venue inviting. For instance, a McDonald's might want uptempo dance choons to give the impression of being busy at its quietest periods during the morning, but pump out something more soothing at periods of hectic queuing. Clothing stores aimed at the middle-aged will be looking for nostalgic tracks from their customers' adolescence.
Imagesound makes its money from advising chains such as Yates wine bars, Holmes Place gyms and Bhs, the retailer, and also by maintaining the sound equipment and supplying the music. The company is merging with two other rivals via a three-way acquisition by Advance Capital Invest, a long-dormant shell company, but it promises that the deal is the first of several in this fragmented industry.
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