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Dowgate Capital - Capitalising on the booming AIM market (DGT)     

overgrowth - 09 Feb 2005 20:52

Dowgate Capital (DGT) are sitting in the middle of a goldmine!

This company through their sole trading arm City Financial Associates are looking to take full advantage of the "booming" AIM market this year. Dowgate provide NOMAD (NOMinated ADvisor) services to AIM companies and also have full Corporate Broker status which means that they can fund placements on behalf of the companies they represent.

On first sight, the fact that Dowgate exist in the often veiled financial services sector makes you think twice about investing in company such as this because it would be impossible to understand what they were doing - however, think again!

DGT bring new companies to the AIM (Alternative Investment Market). For each new company "floated" on AIM, they take arrangement fees when acting as NOMAD. After the company is launched then for a nice steady earner DGT get another healthy chunk of cash every year for looking after them (note that all AIM companies must have a nominated adviser - thereby securing a ready source of recurring income).

Because DGT also act as a Corporate broker they can get a very healthy percentage for arranging placement of shares with insititutions before a new company floats. In addition, because placements come outside the sphere of yearly NOMAD work, they can also gain healthy percentages of placements which companies may need to make throughout the year when they need a quick injection of cash to speed growth.

Current NOMADships: 28 companies represented (gives recurring income of approx 480,000 per year)

Current on-going Brokerage agreements: 19 companies (income depends on placements)

For flotations, depending on the size of a company, fees charged will be anything from 50,000 to 100,000+ For placements (the real earner), DGT get anything from 3% to around 12% of the TOTAL AMOUNT RAISED - For example a new company raising 3M though a placement will earn DGT anything from 90,000 to 360,000 ! These figures are indicative as actual deals all differ due to circumstances and DGT sometimes take payment in shares - they still have a tasty chunk of Setstone shares and when this Russian exploration company comes back to AIM, predictions are that the share price will rocket. Note that the amount that this little company can earn in fees is huge and every new deal that comes through we know will contribute another healthy chunk into the bottom line. The good news with every new floatation means that it's another chunk of recurring revenue which could go on for years, with DGT having to do very little. New clients gained in 2005 are:

Mediazest (NOMAD & broker) Elite Strategies (NOMAD) Process Handling (NOMAD) Poland Investment Fund (NOMAD) Nanotech Energy (NOMAD & broker) Archimedia Ventures (NOMAD & broker) Red Leopard Holdings (NOMAD) Alba Mineral Resources (NOMAD & broker) Intandem Films (NOMAD & broker) Motive Television (NOMAD) IncaGold (NOMAD) Sportswinbet (NOMAD & Broker) Infoscreen Networks (NOMAD & Broker) Mark Kingsley (NOMAD & Broker) Croatia Ventures (NOMAD & Broker) Pantheon Leisure (NOMAD) Firenze Ventures (Ofex Advisor) FlightStore Group (NOMAD & Broker) Euro Capital Projects (NOMAD) Pearl Street Holdings (NOMAD) Worldwide Natural Resources (Ofex Advisor) Dovedale Ventures (Ofex Advisor) Other 2005 work completed:Neptune-Calculus VCT offer for subs of up to 12 million Advisory work for TGM on London Bus disposal for 20.4M Advisory work for Creightons on property disposal Advisory work for Hampton Trust on company restructuring Advisory work for Interbulk Investments on acquisition of Inbulk Advisory work for Fundamental-e Investments on two disposals Advisory work for Designer Vision re: Design Rights against Centurion Electronics

Click Here for fundamentals and profit projections.
Chart.aspx?Provider=Intra&Code=DGT&Size=Chart.aspx?Provider=EODIntra&Code=DGT&Si

stockdog - 12 May 2005 23:55 - 535 of 2787

Thanks for the consolation OG - hanging tight!

sd

Ted1 - 13 May 2005 14:29 - 536 of 2787

Another tick up but on such little volume. Are the mm's really running out of stock?

arawli - 13 May 2005 14:42 - 537 of 2787

Website has been updated but at work so can't check what we got from floats

Andy

ptholden - 13 May 2005 14:50 - 538 of 2787

Motive TV - 60k plus 15k NOMAD retainer. Ian Buckley also does very well, but presumably as an individual and not part of CFA. Oh, to be a part time Director!!

overgrowth - 13 May 2005 15:08 - 539 of 2787

Intadem:

70K corporate finance advisory fees
20K NOMAD retainer
5K Broker retainer

Interestingly the total costs relating to placing/admission are 270K.

arawli - 13 May 2005 15:11 - 540 of 2787

2,000,000 warrants in INtandem as well

Andy

moneyplus - 13 May 2005 15:14 - 541 of 2787

someone just bought 500 000 that makes one large sell early today and 3 lots of buys. all we need is for this to continue next week and we'll be breaking on up!

overgrowth - 13 May 2005 15:19 - 542 of 2787

mp - it will be nice to see a break out upwards for a change - the new guys have certainly been bringing in plenty of business, the sp should be now at least where it was around the end of November last year.

What's happening with Setstone these days? - that could rekindle some buying interest in CFP also as they have a fair few STN shares.

ptholden - 13 May 2005 16:52 - 543 of 2787

According to the 'other side' Setstone are still messing about re-listing and it appears there will be further delays before the issue is resolved, probably about June.........maybe.

Nice 2,000,00 T trade just gone through and I have to admit to topping up again today, although was after close of play, so hasn't shown up yet.

PTH

EWRobson - 13 May 2005 21:24 - 544 of 2787

That's a good point, stockdog, re the unvirtuous cycle of sells triggered by investors selling small cap funds. Means that sp is being pushed down below its proper level. Reckon you are right not to include any valuation of warrants: can't see that they can be described as an asset as price may not be above exercise price. Presumably they take warrants firstly as a sign of cinfidence and secondly in lieu of part of their fees. I notice that Interregnum (ITR) have built up significant shareholdings in a number of their client's stocks so they must take shares in lieu of fees rather than warrants.

Eric

ptholden - 13 May 2005 23:02 - 545 of 2787

Eric

Fair point about the Warrants, but I would argue that they can be viewed as an asset when the SP is above the exercise price, which in at least one cae it is (haven't checked all of the documentation, so there may be more and no doubt CFA will be in a good position to judge when to exercise their warrants.

PTH

overgrowth - 14 May 2005 20:56 - 546 of 2787

PTH - best to set up our forecasting model erring on the side of caution - then all the surprises we get will be pleasant ones lol!

It looks as though there is some large buying going on in the background currently which is forcing the MMs to hike up the price a bit because they consider CFP "a tiddler" and don't hold much stock.

Continued good news on a reasonably regular basis as we have seen throughout 2005 so far and we'll be soon up to SD's 1p short-term target.

Also, as reported in the FT on Friday:

"Monday sees the launch of the new series of Aim indices. The FTSE Aim UK 50 index will comprise the largest eligible UK-domiciled stocks by market capitalisation, the FTSE Aim 100 index will include the international companies, and the FTSE Aim All-share will include only those companies that both have a minimum free float of 15 per cent and meet liquidity qualifications."

This will ensure that the AIM business keeps flowing freely for CFP!

EWRobson - 14 May 2005 22:25 - 547 of 2787

Interesting comment by Tom Winnifrith of t1ps. Just as the FT100 is dominated by 5 stocks and good performance of BP and Shell has helped the index, so AIM is dominated by 3 including Sportingbet and NETeller both of which have eased considerably. It will help to have the AIM index broken down; it probably has not eased that much, although small investors may have been frightened out of their holdings.

Agree best to be on the cautious side with CFP forecasts. Its great that og and sd have been doing the homework, though, baceause we know that it is only a matter of time before the really positive movement.

Eric

ptholden - 17 May 2005 07:21 - 548 of 2787

Loss of Broker client, but possibly some fees for advising on the Placing. Good news as still retained as NOMAD.



DESIGER VISION GROUP PLC

('Designer Vision' or the 'Company')

PLACING AND APPOINTMENT OF BROKER

PLACING

Designer Vision is pleased to announce that, through Lewis Charles Securities,
it has today placed 7,692,308 new ordinary shares at a placing price of 6.5
pence per share representing approximately 12.8 per cent of the enlarged share
capital of the Company, to raise approximately 500,000 before expenses.

The Company is raising additional working capital in order to facilitate the
significant increase in demand for products arising following the recent
acquisition of Tech Trade Limited and the increasing order flow for the OEM
business. The placing proceeds, together with an increase in the Company's bank
facilities, will be used to take full advantage of the new levels of demand for
portable and in-car entertainment systems.

Application will be made for the 7,692,308 new ordinary shares to be admitted
to trading on AIM and dealings are expected to commence on 27 May 2005.

APPOINTMENT OF BROKER

The company is delighted to announce the appointment of Lewis Charles
Securities Limited as its sole broker. City Financial Associates will continue
to act as the Company's Nominated Adviser.

Godfrey Bilton, Chairman, commented,

'The appetite for this placing has been very encouraging and we are delighted
to welcome new shareholders who have recognised the significant potential for
Designer Vision within its chosen markets. The Board continues to view the
current year with confidence.'

overgrowth - 17 May 2005 15:53 - 549 of 2787

Tony Rawlinson has said in the past that brokering placements is very time consuming and hence resource intensive.

In this case for the sake of a 500K placement on an existing client, they're unlikely to "bust a gut" to save the brokerage agreement, cutting margins to the bone to compete with other companies perhaps prepared to take a loss leader.

Far better to concentrate on driving the new company forward and ensuring continued success by attracting new clients to the new corporate regime.

CFP need to make the best use of their currently limited resources to ensure that the business as a whole turns profitable as quickly as possible. In theory, the company should already be in the black for H1 2005, which is good going as we've still got around one and a half months to go.

CFP have plans to bolster their core business by extending the brokerage team, however it's key right now to ensure that the core business (floating new companies) is kept on the right track. I suspect that towards the end of this year we will witness CFP being much more prominent in the brokerage arena and as this progresses, the amounts raised in placement will be larger along with the tasty commission for CFP.

ptholden - 17 May 2005 17:14 - 550 of 2787

I note that CFA have 46296 Warrants at 54p in Ragusa. They may only be exercised when Ragusa have made their first investment or acquisition. Ragusa are currently conducting due diligence on a possible acquisition in the oil sector. They also now have a notifiable investment in Aurum Mining AUR.

Looks like a double whammy winner with both exercisable warrants and fees for the acquisition (assuming it goes ahead).

PTH

Ted1 - 18 May 2005 14:50 - 551 of 2787

Are the mm's holding the sp down until the mystery buyer who buys 2 million at a time has filled hisher boots?
Another 2 mil today @0.0040 how many is that now 3,4?
This being just ahead of the agm.
All looking very positive imo.

og
Like all the work you have done here and at mdw,coh.

overgrowth - 18 May 2005 14:57 - 552 of 2787

Ted1 - cheers for the compliment (I've done RTD also - that board header was desperately in need of a re-vamp).

I agree. It looks as though this mystery buyer put in a very large order some time ago and agreed a price of 0.40p. The MMs are waiting to get sells to fill parts of the order each day.

I'm expecting a bullish statement from Tony Rawlinson at AGM next Wednesday, it will be intesting to see the effect on the shareprice which I still maintain should now be at around the 0.70p level given that CFP are estimated to be already in profit for H1 2005!

stockdog - 18 May 2005 16:40 - 553 of 2787

At last count, my model is 24k short of break even for the full year after counting Inca Gold and Design Vision recent xactions.

I too expect positive forward looking view at AGM next week.

sd

overgrowth - 18 May 2005 16:48 - 554 of 2787

sd - If they're 24k short of break even for the FULL YEAR that's fantastic news, it means that we're looking at a very healthy profit at the end of 2005 particularly if the rate of work keeps up in the same way as we've experienced so far.

What's your projection of FY profit ?
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