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.

Website: www.cityfin.co.uk

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.

Nice one SD, and many thanks for posting up to date details from "the model" which look fantastic.

Re: Interregnum - Tech. stocks are not currently flying in general and institutions looking to invest in placements for a company which effectively funds these stocks will need a lot of convincing - this is what I interpret as these "market conditions".

Overall AIM market conditions continue to be bouyant and DGT cover a wide range of sectors in their floats, shielding them from the sector-specific effect.

I started a thread about a week ago, which unfortuntaely didn't spark any interest. Essentailly referring to the downturn in the AIM Index. I thought then that the Index was oversold and since posting it has risen steadily. I believe that any doubts that new companies would have had about floating for the last few months will probably have been dispelled by the current strength of this market.

Notwithstanding your lead sd, there seem to be a few others dipping their toes into DGT. I sometimes get the feeling that their are a few hardy souls whom have stuck with this and practically prop the SP up on their (our) own. Although, I am sure that is not the case really. There are a lot of lurkers who will be watching and waiting. The Interims are not far away and I will be surprised if we don't see greater activity before then.

pth

pth - certainly concur with your observations, now is the time for limpets...

I agree - it looks as though we're going to have to wait for interims before we get any serious buying which will move the price up quickly.

At these prices you can get a million shares for round about 4K, I'm sure that we'll get a few more potential "share millionaires" willing to have a dabble when they see proof of the excellent performance so far this year.

BusinessWeek Online
Europe's Small-Cap Fever
By Beth Carney


Europe's small-cap stock markets are booming. Last year, the London Stock Exchange's junior exchange for small companies, the Alternative Investment Market (AIM), attracted 226 initial public offerings, the most in its 10-year history and more than three times the number it drew in the previous year. In April, the Irish Stock Exchange opened the Irish Enterprise Exchange, a junior market for smaller companies. And on May 17, the European stock exchange Euronext is opening a growth market in Paris, called the Alternext, which will focus on listing the one million small-cap companies in the euro zone.


The question now: whether AIM and its emerging rivals can continue to succeed where European exchanges have failed in the past. The Neuer Markt, run by the Deustche Boerse in Frankfurt, which was set up in 1997 for technology companies, collapsed in 2003 after the value of its top 50 companies fell 95% from their peak and several became embroiled in scandals. Other growth markets -- such as an earlier Euronext small-cap market called the Nouveau Marche -- simply never established critical mass and had to be subsumed into existing stock exchanges.

Small-cap exchanges are reemerging as a force in Europe, partly to allow small companies to avoid stricter European Union regulations coming into effect in July that will create new guidelines for reporting and company prospectuses. The new exchanges, like AIM, will be exempt from some of those requirements, because they are classified as self-regulated. Like AIM, the new markets will have simpler listing requirements and regulatory regimes than major European stock exchanges.

POWERFUL DRAW. The junior markets are also seen as a growth opportunity for major exchanges operating in an increasingly competitive environment. As in the United States, where the New York Stock Exchange and the Nasdaq are attempting to become more competitive by buying electronic trading platforms, stock exchange consolidation looms in Europe, too. British authorities are now reviewing an initial approach by Euronext to buy the London Stock Exchange.

In the meantime, AIM's success in attracting both companies and investors has clearly been a powerful example to its rivals. There are 1,127 companies listed on AIM, including 134 from outside Britain. International listings grew by 15% last year, faster than the 9.7% growth in domestic listings, and AIM's new listings accounted for more than half of all new listings on stock exchanges across Europe, according to statistics complied by the Federation of European Stock Exchanges. Though the average AIM firm has a market capitalization between about $20 million and $40 million, the largest are valued at more than $1 billion.

AIM's performance is another draw: In the 12 months that ended in April, the FTSE AIM index gained 12.6%, outperforming both the FTSE 100 and the FTSE small-cap indexes. A total of $8.8 billion was raised on the exchange in 2004, more than doubling the $4 billion raised in 2003.

BIGGER RISKS. The key difference between AIM and earlier growth markets is the exchange's looser regulatory regime, according to Tim Jenkinson, a member of the finance faculty at Oxford University's Said Business School. Under AIM rules, companies can enter the market with no trading record, no minimum market capitalization, and no prospectus. The London Stock Exchange does not review any admission documents.

All the companies need in order to list is for one of several dozen designated nominating advisors -- which include brokers, accounting firms, and investment banks -- to sponsor the company's admission. "It's a very different type of market," said Jenkinson, who attributes its popularity to the relative ease of access.

Of course, the flexible listing process, though cheaper and easier for companies, dramatically increases risks for investors in AIM-listed companies. One concern has been the number of cash shells listing on AIM -- investment companies with no physical business that are formed to raise money for purposes such as mineral exploration or making acquisitions. Last month, the London Stock Exchange tightened AIM's rules regarding such businesses, requiring them to have a $5.7 million market capitalization before listing.

"MORE SILT." However, the threat of the rule change prompted a rush of cash shells to the market. According to a study by the accountancy and consulting firm Grant Thornton, which advises AIM companies, half the companies that have listed in the first quarter of 2005 are cash shells, which are by definition uncertain propositions. "The types of companies on AIM tend be of a higher risk profile," says Richard Staveley, manager of the SG UK Smaller Companies Fund at SG Asset Management, who limits his fund's investment in AIM to 20% because of the risks.

Adds Crispin Finn, manager of British growth funds at Credit Suisse Asset Management: "There are far more low-quality companies on AIM. In order to find the hidden jewels, you have to sift through a lot more silt."

Both the Irish and Paris exchanges have somewhat stricter listing rules than AIM. The Irish Enterprise Exchange requires companies to have a minimum market capitalization of about $6.4 million, in order to discourage cash shells, and Alternext will demand that companies place at least $3.2 million in public hands. Both exchanges will use sponsoring advisers to help companies list and ensure their compliance.

AIM WANNABES. Whether the new exchanges will replicate AIM's success remains a question. AIM has one big advantage -- a tax break the British government gives to investors in AIM companies to encourage startups. "AIM has such an accepted international reputation, I believe that for some time it will be the first choice," said Simon Boadle, corporate-finance partner at PricewaterhouseCoopers, which advises AIM companies.

For now, AIM is the leader that the others hope to emulate. "AIM is the model that has worked," admits Brian Healy, director of trading at the Irish Stock Exchange. But competition is heating up as rivals aim to emulate AIM's success.

Good find butane - that confirms that DGT are on course for providing a repeat of the fantastic H1 performance in H2 also.

If that's the case, then we're going to be looking at a very healthy company by the end of 2005.

An interesting 750K trade (recorded as a sell) has just caused a tick up on the bid - must have been a buy, and at that price it can only be another director buy IMHO.

When these "special discount" director buys are out of the way the shackles should be released and we ought to see the price moving up what I would say is fair value based on current trading of around the 0.75p mark.

but how many special discount shares do the directors
or even ex directors have
hmmmmmmmmmmm

still smell farm here but the stench is not as bad as it was imho of course

Progress DF. Before long you will be back in, hope you don't leave it too late.

WT

I have for a while suspected that TR likes to keep the news cool in order to keep the SP where he and colleagues can buy during the relatively few periods open to them. Although a little frustrating on a daily basis, mid to long term we will all benefit by a slower moving more certain SP with a good weight of serious investors behind it, rather than what could so easily become a very volatile share at these prices.

Looking forward to 1p by year end.

sd

C'mon DGT time to reward the patient.
An god knows w'eve been patent Lol
Stevie

Wahaayy the Limpets !

Looks like a classic tree shake. Mm's need your shares. Selling at 41 42. Hold on potential to double your money by xmas. There not havin mine.

Ted - doesn't the price normally go down rather than up with a tree shake?

It looks as though the tree's just been given some fertiliser - perhaps that's what deadfred's been on about all this time lol!

og can't you shake a tree up. If the mm's haven't got any shares then they hike the price up and people sell to take a profit. Only the weak or short termers though. Hey I'm quite new to this but I bet a small retractment before the bell. What do we think to that.

I take it all back. Nice lage 700k at 0.005! long time since I saw that. What the hell do I know anyway. Come on dead jump back on quick, I dare ya!!

Ted - I think you mean retracement ?

I reckon the limits will stick as they are now - expect to see some late trades recorded around the close.

It's all a guessing game though, it's probably 50:50 as to which one of us gets it right lol!

lol! I was doing other stuff and didn't notice the 700K buy - honest...

Afternoon all,

Just back from golf and very pleased to see a nice tick up. Can't say I am that surprised, we have been waiting a while and those of us who have been here for sometime know that the company has had a good H1.

Nice and steady increases up to the Interims will do just fine thank you very much.

pth

Picked up a nice 250k before close last night !