SMALL CAP MOVERS: Redx Pharma achieves successful £14m fundraise

The vogue currently among small- and microcaps, if you can call it that, is to raise modest sums by selling shares at bargain-basement prices.

In order to tempt risk-averse investors out of hibernation, discounts have regularly been set at 50 per cent, with one unfortunate AIM struggler forced to drop the value of its stock by more than 80 per cent to bring in new funds.

So, it was with slack-jawed amazement that the market greeted the latest investment round by Redx Pharma (flat at 26p).

Not only did it raise a substantial wedge of cash compared to its market capitalisation – just over £14million – it did so at around the prevailing share price.

Its newfound wealth will be ploughed into its portfolio of clinical and pre-clinical assets, which potentially promise a revolution in the treatment of fibrosis and cancer.

Fundraise: Redx Pharma raised just over £14million from its latest investment round

Turning to the wider market, the week has been as rotten as the weather for the AIM All Share, which lost 1.8 per cent of its value to 683.77 as investors continued to sit on the sidelines.

The movement essentially mirrored that of the FTSE 100, which has been dogged by political unease caused by the Israel-Hamas conflict.

Ethernity Networks’ return from suspension was not an auspicious one, with the stock tumbling 58 per cent to 0.3p.

In common with a number of smaller businesses, it faces some pretty stiff financial headwinds, including a ‘significant and unexpected increase in cost and lead times’ for components.

In journalism, we have a name for yarns that turn conventional wisdom or logic on their head.

We refer to them as man-bites-dog stories. Sosandar’s news this week certainly seems to fit into that category.

A success online, the fashion chain is now looking to open physical stores. To say the news spooked the market would be an understatement, with the shares sliding 40 per cent to 11p.

‘Very challenging’ is how Revolution Bars Group described the late-night market as it unveiled its latest results.

The owner of ‘Revs’, Revolución de Cuba, and the Peach Pubs chains slumped to an operating loss as it said it had endured a ‘challenging start’ to the new financial year.

The award for the deal of the week must go to Jason Tebb and his team at OnTheMarket, who have brokered the £99million sale of the online estate agency to US real estate information specialist, CoStar.

For investors, this was an elegant exit, valuing their shares at 110p each, or a 56 per cent premium to the pre-bid price.

For Rightmove, which will now face a beefed up and financially well-endowed rival in the property listings sector, it was a massive shock that sent the stock tumbling on Thursday.

Sticking with the deal theme, shares in Gama Aviation jumped 63 per cent after it announced the sale of its maintenance and repair subsidiary, Jet East.

Net proceeds from the sale are set to be around £83million, translating to a return of funds to investors of ‘not less than’ 55p a share.

With the gold price bobbing around $2,000 an ounce, burnishing its credentials as a haven asset in times of strife, investors were looking at tangential methods of profiting from the price of the precious metal.

That meant the junior diggers, prospectors, and mine developers were well bid this week.

None more so than Wishbone Gold, which was up 26 per cent at 2.36p. Recent news flow from Wishbone has been fairly solid too.

Last week it told investors that reverse circulation drilling had been completed at its Red Setter project, and it plans to begin diamond drilling at its other Pilbara project, Cottesloe, in the next two weeks.

In the healthcare sector, it has been an excellent week for Ondine Biomedical, with the shares up 28 per cent at 10p.

Offering a potential revolution in the way medics prevent post-operative infections, Ondine has pioneered a process called photodisinfection.

Without being too graphic, it uses a patented nasal gel that is light-activated.

The latest research has shown that its Steriwave technology can eliminate more than 99.9 per cent of antibiotic-resistant bacteria.

The study comes as a significant development in the fight against antimicrobial resistance, a growing public health crisis responsible for 33,000 deaths annually in Europe alone.

Finally, October has heralded a couple of listings that may have slipped under the radar.

Substrate AI made its official debut on the Aquis’ AQSE Growth Market, marking its entry into the AI sector with a unique proposition.

Its biologically inspired learning technology is the creation of co-founder and chief technology officer Bren Worth.

At the same time, SSV Capital joined the JP Jenkins matched bargain platform.

Set up in 2020, it has begun to make significant strides in the realm of disruptive technologies, with a focus on fintech and ‘proptech’.

To read more small-cap news, click here: www.proactiveinvestors.co.uk.

This post first appeared on Dailymail.co.uk