The Private Investor: 'For small investors, watching a firm go private is bittersweet'

Who'd have thought it, the FTSE at 4,000 or thereabouts? Quite a fillip, really. And there are other interesting things going on in the market, although they provoke contradictory emotions.

Watching a company go private is a bittersweet experience. Sweet, because the exercise usually means a decent lift to a bombed-out share price, and confirmation that at least someone out there shares your judgement about the underlying merits of a company. The bitter bit comes when you realise that some other guy is going to squeeze the potential, and the value, out of your undervalued company. In other words, you, the small investor, after going through the pain of missed dividends and a slump in the share price, are going to miss out on the sunlit uplands.

So my faith in James Brown's inspirational leadership of I Feel Good (publisher of the excellent Viz and Jack) has just been repaid by having my small share of the company bought out by the mega-rich publisher Felix Dennis. I think I'm about quits on my holding. I just hope that the Fat Slags are safe in his hands.

Similarly, rumours are that Brian Souter is going to take his baby Stagecoach private have done wonders for the share price. Mr Souter has clearly got fed up with the descent of his mighty company into near penny share status.

I did, bravely I thought, buy Stagecoach at the bottom, or near it, at about 15p and 20p and sold when they'd doubled. Since then they've risen by a further 50 per cent and are close to the dizzying 50p mark. How much of this has been due to the general return of confidence and how much the rumours, I cannot say, but I wish I'd tagged along for more of the ride.

The psychological effect of such an experience is to say to oneself that one has already missed out on the party, shrug and turn away. A bad attitude, of course, because even at their new levels Stagecoach can still be considered cheap. Circumstances change. We cannot say what Mr Souter has in mind. The prospective yield is no longer in double figures but it is still reasonable at 4 per cent (if you take a certain view on how secure the divi is).

Railways and buses should be a secure sort of business, although the risks of disruption are well advertised. Then there is the increasing prospect of further consolidation in the transport industry, in which Stagecoach will be a key player. And they have taken painful action to deal with the ill-starred US end of the business.

So there are reasons to be cheerful about Mr Souter's firm, but I am still not convinced that I ought to take the plunge once again, mainly because most of the upside has now been exploited.

Another firm that I have always kept an eye on, but have never yet invested in, is Manganese Bronze, which does something you might have thought had become extinct in the UK; it makes things.

Not only does it make things, but it makes things with wheels that move and parts for things with wheels that move, namely the London Taxi Cab (TX-1) and parts for the car industry, MG Rover included. It is thus not exactly well placed to be a darling of trendy analysts. Last week came the telling news that the company's sales of taxis had been falling, itself quite a good indicator of the state of the capital's economy.

There is always the danger that the hansom cab regulations will be changed. Those familiar cabs may at some point be supplanted by some ghastly Peugeot people carrier. Against that is an interesting project to make the TX-1 in China, although the group is as yet without a partner there.

Interestingly, Jamie Borwick, the chairman of Manganese Bronze, has resigned from his post after it emerged he is behind a bid approach for the company. He made an approach to take the company private in December. Now he and the board have decided that Mr Borwick ought not to remain in post while his bid is under discussion. Together with Rutland Investments, a Bahamian- registered trust owned by his family, Mr Borwick controls 40 per cent of Manganese.

Mr Borwick has talked about opportunities for his company, but added: "There are clearly considerable risks that it faces as one of Britain's last motor manufacturing businesses." The shares fell again.

My nerves just aren't strong enough to catch a ride in this cab. Not yet.

s.ogrady@independent.co.uk