Tadpole plunge suspends shares
Friday 12 May 1995
Market makers were unable to keep pace with the collapse, and share prices were declared indicative at 10.30am. Suspension came two hours later. The lowest trade was struck at 118p.
There were strong rumours in dealing rooms in early trading that Tadpole was strapped for cash to fund production of new orders, principally for the P1000 notebook, and would announce a rights issue along with interim results next Wednesday.
There were also unconfirmed reports that Albert E Sharp, broker to Tadpole, was inundated with calls from fund managers. In March, the broker placed 1.25 million new shares in Tadpole with institutional investors at 201p each.
James Warhurst, one of Sharp's analysts, said in February when the shares were at 195p that investors would not see a "more opportune moment" to buy. No one at Sharp was available yesterday for comment.
Tadpole has been one of the best-performing new issues in recent years. The shares were floated at 65p in early December 1992 and were trading at 350p by the New Year.
A peak of 423p was reached last November, but the price collapsed by 25 per cent in one day in mid-January after a warning that the company would incur larger-than-expected half-year losses due to delays in shipments of new products.
The decline in the share price will dismay the band of small investors who have been heavy buyers of Tadpole shares this week. Sharelink, the execution-only stockbrokers, said Tadpole was its best-selling share over the five trading days to Monday night. It ranked tenth for clients with self-select personal equity plans.
A company spokesman said yesterday that the half-year results announcement would now be brought forward to Monday. He declined to comment on the cash-call rumours.
However, one analyst, who declined to be named, said the rumours appeared to have no foundation and he would be "absolutely surprised" if Tadpole made a rights issue.
Analysts expect Tadpole to announce a half-year loss of £2m to £2.5m and then move sharply into profit and make a positive £2m for the year.
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