City View: Deal gives Metalrax a lift
Do you fancy Metalrax as a recovery bet? That was the scenario being outlined by house broker Arden Partners yesterday after the restructured, slimmed-down, Kings Heath manufacturer finally put its much-touted refinancing deal to bed.
It also bade farewell to the man credited with clinching the deal. Finance director and company secretary Michael Stock leaves on October 31.
A trawl through the Birmingham Post electronic archive shows that Metalrax has endured something of a rollercoaster road since the Millennium. A sustained period of growth through the 1980s and 1990s subsequently degenerated into a series of setbacks followed by predictions of recovery, most of which never quite seemed to materialise.
Metalrax is a stock with a pretty loyal following, although one private investor broke ranks at the 2005 AGM and blamed executives for, among other things, a seven-year decline in earnings.
Since then the management team under chairman John Crabtree, the former top man at Wragge & Co in Birmingham, and chief executive Andrew Richardson, who joined in 2008 after the company relegated itself from the main market to AIM, have done a good job in keeping the ship off the rocks of recession.
The most recent threat disappeared yesterday when it said that the formalities had been completed on the £23 million lifeline that it had been negotiating with HSBC and RSB.
Metalrax certainly left the City in no doubt how important this was in September with the warning that the still-to-be-concluded negotiations represented “a material uncertainty” over its status as a going concern.
That uncertainty was removed yesterday and more than one million shares changed hands to send the price of this otherwise pretty illiquid stock up by 23 per cent to 6p a throw.
That’s a heck of a long way off its more recent highs but at least the shares are off the bottom and, as Arden, says in its latest briefing note “recovery investors may view Metalrax with increasing interest”.
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ITV said yesterday that the worst of the advertising slump may be over. If that’s right, it’s good news for all of us in the wicked, commercial, non-taxpayer-subsidised media who rely on advertising to keep us in work.
The only really interesting question about ITV is who will be next to turn down the chairman’s job.
Sir Michael Bishop and Sir Crispin Davies have turned it down while interim chief executive John Cresswell says he wants out.
Strange times indeed.
