Kingswood H. Regulatory News (KWG)

10 Jun 2005 07:00

Equity Pre-IPO Investments Ltd10 June 2005 10 June 2005 Equity Pre IPO Investments Limited ("Pre IPO") Investment Update 8 Investments made totalling £1.94 million Pre IPO, the AIM-quoted strategic investment company, is pleased to announce ithas to date invested in a total of 8 companies, 7 of which have been made sincePre IPO floated on AIM in February 2005. Details of these investments are setout below. Lorega Limited Pre IPO currently owns 625,000 shares in Lorega, representing approximately15.5% of the issued share capital of this privately owned company. Lorega wasestablished in 1983, originally as a claims consultancy service for businesses,and has now grown in to a leading provider of products and services focused onmaking the claims process easier for private clients and commercial insurancecustomers. The directors of Lorega have confirmed to us that the companycontinues to develop well and that turnover for 2005 is expected to be more thandouble that of 2004. Creon Corporation PLC Pre IPO owns approximately 1.6% of this company which has achieved a flotationon to AIM. Pre IPO invested at 4 pence per share and the current share price is53 pence per share. Creon provides mezzanine finance to small and medium sized UK residentialproperty developers. The business is underpinned by the experience of theDirectors and of the members of its project manager, Creon Equity LLP, who havehad a wide-ranging involvement in this market. The company supports propertydevelopers with demonstrable track records seeking to finance developments ofbetween £1.0 million and £5 million in an efficient and affordable way. Typicalinvestments are between £250,000 and £750,000 for periods of approximately 12-18months. We continue to be positive about this investment and Creon's prospects. Homebuy Group PLC Pre IPO purchased 60,000 shares in a placing by Homebuy which is quoted on AIM.This investment is showing an unrealised profit of approximately 20%. Homebuy's principal activity is the retail sale of household consumer goodscombined with the provision of associated hire purchase finance. IMS Sales & Marketing Limited Pre IPO currently owns approximately 1.7% of IMS. IMS was founded in 1993 and offers a complete range of sales and marketingservices to the emerging Russia, CIS and Eastern European markets. The companyhas developed rapidly over the past 5 years and has grown at a rate in excess of50% per annum. The company has been profitable since 2000. IMS currently has400 full time employees operating in 8 separate business units, each of whichservices a particular section of the sales and marketing universe, for example,traditional field marketing, corporate entertainment, customised research. IMS has also recently undertaken a number of expansion activities in order towiden its product offering (acquiring a call centre and a PR company) andgeographical coverage (India, Hungary). The company expects these to contributeto the on-going growth of the company. We understand that preparations for the flotation of the company on to AIMduring 2005 are on-going with advisors having been appointed. Altair Financial Services Limited Pre IPO currently owns approximately 3% of the issued share capital of thisprivately owned business. Altair has developed a payment system that revolves around the mobile telephone.Altair provides full internet banking facilities with the cash held in virtualaccounts linked to the customer's telephone number. To transfer funds, thecustomer texts to Altair the amount they wish to transfer and to whom. Thecustomer either provides the receiving party's name if they are also an Altaircustomer or their mobile telephone number. After a security protocol the cashis transferred. The beneficiary receives a text message (and an e-mail if he isalready a customer) informing him he has received funds, with the cash beingimmediately credited to the account. If he is not an existing account holderthen he can register via the internet. Funds can be spent on the internet whereAltair has opened merchant accounts, to land-based stores by keying in to hismobile telephone the store code. The customer can also link his account to adebit/bank card for payments and cash withdrawals from ATM Machines. Fullinternet banking facilities are also provided to the account (for standingorders, direct debits etc). The directors of Altair are currently preparing the company for a further fundraising and flotation on to AIM. We understand that various advisors have nowbeen appointed and that further news on this will be announced shortly. Pre IPO has, in addition, invested £600,000 into a further three unquotedcompanies. These investments, however, have to remain confidential at this timedue to commercial sensitivities. Pre IPO has currently got cash reserves ofapproximately £500,000 for further investments. We have also spent a considerable amount of time researching and analysing theEuropean textile and fashion industry. We believe that this sector hasundergone significant change over the last few years, brought about by theexpansion of the European Union, the increasing dominance of large retail chainsaround Europe, general market conditions and increased global competition. Wetherefore believe that there are considerable opportunities to create a largeand profitable business in this sector. We have now arranged for theincorporation of a new company and have provided some of the initial riskcapital into this company in order to provide a specialist vehicle targetingtakeovers and mergers in the textile and fashion sector in the EU. We expect tobe able to provide further information about these efforts in the very nearfuture. Martin Shires, Director commented "With three of the companies we have investedin actively working on a flotation at this stage and two already quoted we arewell on track to achieve our ambition of re-cycling investments profitably andregularly. We continue to experience a very healthy pipeline of high qualitycompanies, with our investment activity now being limited by the funds currentlyavailable to us." For further information, please contact: Jonathan FreemanNon-Executive DirectorEquity Pre IPO Investments Limited Tel: +44 (0) 1600 750432 Martin ShiresDirectorEquity Pre IPO Investments Limited Tel: + 44 (0) 1481 714 161 Company Profile: The Company, which floated on AIM in February 2005, aims to achieve capitalgrowth for its shareholders through the purchase, holding and sale of minoritystakes in other companies and entities. It is intended that the Company willinvest in companies which are unquoted but where the directors of Pre IPObelieve the company will achieve a flotation in Europe within up to eighteenmonths from the date of the investment. This information is provided by RNS The company news service from the London Stock Exchange