LONDON (Thomson Financial) - UK small caps stayed sharply lower at midday, reflecting the negative mood of the blue chips, with Bateman Litwin heading the fallers as its contract to build a 37 mln usd US ethanol plant was cancelled.
At 11.47 am, the FTSE Small Cap index was 23.10 points down to 3,400.50, while the FTSE 100 index lost 41.70 points to 6,495.20.
Bateman Litwin led the sliders, down 37-1/2 pence to 172-1/2 pence, as it said Agra Industries Inc has cancelled a contract for a 37 mln usd ethanol plant in the US awarded to Bateman Litwin's subsidiary Delta-T Corp, but that the cancellation will not impact its results for the current financial year.
The energy contractor said the financial impact will be limited to a backlog reduction of around 32 mln usd and the associated profits over the
18
month life of the contract.
Elsewhere, a positive drilling update failed to excite for Persian Gold, down 2-1/4 pence to 17-3/4 pence. Sanatana Diamonds also suffered, shedding 24 pence to 75 pence, as traders booked profits after its recent encouraging diamond results.
Meanwhile, recent writedown news continued to weigh on Worthington Nicholls, 0-3/4 penny adrift at 12-3/4 pence, as acquisition news failed to support Dechra Pharmaceuticals, 18-1/2 pence lower at 317-1/2 pence.
Dechra said it plans to buy Danish animal veterinary products manufacturer VetXX for 61.7 mln stg.
The deal will be funded via a 35 mln stg placing and an open offer of 11.62 mln new shares at 303 pence each on an 11-for-50 basis.
Dechra expects the acquisition to be earnings-enhancing in the first financial year and significantly earnings-enhancing from the following year onwards.
Ending the losers after a price target cut to 205 pence from 265 pence by Goldman Sachs was Topps Tiles, 1-1/4 pence off on 164-1/4 pence.
However, William Ransom rebounded 3 pence higher to 13-1/2 pence, as the Medicine and Healthcare products Regulatory Agency (MHRA) concluded a voluntary recall of all products containing purified water from the company's pharmaceutical contract manufacturing facility at Witham, Essex, is no longer required. Consequently, its Radian, Valderma and Pavacol brands are not subject to recall.
Deal Group gained 0-1/4 penny to 1-1/2 pence, as it signed a contract to sell its 51 pct stake in its UK trading business, dealgroupmedia (UK) Ltd., and central technology team to a management buyout team for a total of 1.5 mln stg so it can focus on its Asia-Pacific operations.
Under the deal, the management buyout team -- Isco Technical Services Ltd -- will provide IT services to DGM at an agreed monthly fee.
Meanwhile, digital media technology company Zoo Digital was lifted 2-1/2 pence to 26-1/2 pence, as it revealed narrower first-half pretax losses, and said it sees a positive future, while numbers news also boosted KSK Power Ventur 0-1/2 penny to 315 pence, as it swung to a first-half pretax profit.
The Indian power project development company sees significant opportunities in the second half and early next year.
Zotefoams moved up 3-1/2 pence to 96-1/2 pence as its trading update beat market expectations, prompting Evolution Securities to keep its 'add' stance and price target of 138 pence.
The foam manufacturer said it continues to perform well in the second half, and it expects 2007 results to be ahead of market expectations.
Plant Health Care rose 26 pence to 286 pence, as its Plant Health Care Inc unit agreed to develop and commercialise its Harpin seed technology with Monsanto Co.
Reacting, Evolution Securities kept 'buy' and left its 400 pence price target unchanged, saying it thinks the upfront and milestone payments from the Monsanto agreement to develop Harpin will reduce the loss for 2007 and accentuate the swing into profit in 2008.
Sareum Holdings rose 0.05 to 0.90 penny as it extended its deal with Genentech Inc for a further six months, prompting Seymour Pierce to reiterate 'buy'.
Sareum said it will continue to apply its skills in high throughput protein expression, purification and structure determination on drug discovery targets designated by Genentech.
Seymour Pierce said the extension demonstrates Sareum's capability of fulfilling contract requirements and retaining high-profile customers.
Life sciences company PuriCore was up 1-3/4 pence to 39-1/4 pence, as it signed new deals with five US regional food retailers that have begun to introduce PuriCore's Sterilox Food Safety Systems in recent months.
China Food Company rose 4-1/2 pence to 56-1/2 pence, as its non-executive chairman John McLean acquired 25,000 ordinary shares at 37 pence per share. Lavendon Group was buoyed 29-3/4 pence to 483-3/4 pence after its German operations' managing director Maarten Mijnlieff bought 4,678 ordinary shares at 4.70 stg each, lifting his stake in the company to 4.78 pct.
Physiomics rose 0.025 to 0.475 penny on news cancer therapeutics specialist ValiRx's GeneICE technology has been successfully coupled with Physiomics' In Silico simulation technology to generate a cancer cell death model. Nanoscience stayed up 0-1/2 at 11-1/4 pence following news that wholly-owned subsidiary Toumaz Technology has been granted its core patent regarding the AMx (Advanced Mixed Signal) technology in Australia.
Finally, shares in Adili, an online ethical fashion retailer, were marked up to 19 on their AIM debut.
The company placed 8.57 mln ordinary shares at 17-1/2 pence apiece to raise 1.5 mln stg. The net proceeds will fund growth, including the creation of Adili's 'own label' collection. tf.TFN-Europe_newsdesk@thomson.com hmb/cmr COPYRIGHT Copyright Thomson Financial News Limited 2007. All rights reserved. The copying, republication or redistribution of Thomson Financial News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Financial News.
© 2007 AFX News
