Howle, the cutting tools and tungsten carbide tooling products maker, is going for a full stock market listing with the help of a merger with crashed steel scaffolder SW Farmer.
Howle gets access to Farmer’s £600,000 cash kitty – useful for the busy acquisitions programme George Govan, the chairman and chief executive, has in mind for the merged outfit.
For Farmer’s 280 investors left stranded when the company collapsed in 1986, the deal restores a full dealing facility for their shares.
Sponsor Strand Partners is placing 25% of the enlarged issued capital at 28p a share to raise a net £736,000 after the £264,000 costs of the exercise – not exorbitant for a full quote. Net asset value of the business per share is 29.5p. Teather & Greenwood is the stockbroker.
Subject to Farmer shareholders’ approval, dealings in the new Howle Holdings will start on 27 February.
Howle’s venture capital investor, 3i, is placing 1.3million shares, but Govan and co-founder Paul Sandford will each continue to own 20% of the enlarged firm.
Howle, launched nine years ago, has three businesses: cutting tools maker Richard Lloyd, and Teco and Hoybide, makers of tungsten carbide tooling and wear parts. The group made £572,000 pre-tax in 1995 on sales of £8.2m.