Digital communications solutions company Retec Interface, in the midst of a reverse takeover of Elite Strategies, has announced an eye-catching tie-up with the UK’s largest retailer.

Already boasting Sainsbury’s, Boots and WH Smith as customers, Retec has now agreed a programme of installations for its ‘Listening Post’ system with retail behemoth Tesco following successful trials within the FTSE 100 giant’s entertainment departments.

In short, Retec’s Listening Post floor standing units allow customers to either touch a screen or scan a product to preview CDs, DVDs and games. ‘We make a margin on the capital cost of the equipment’, explains John Cole, Retec boss and proposed chief executive of the soon-to-be-enlarged group, ‘but we really make our margins by supplying all the content on the terminals for the retailer’.

He says that by the end of this year, these systems will be installed in no less than 33 Tesco stores, with a roll out scheduled thereafter depending on store refits (a smaller system that ‘sits on the shelf’’ as supplied to Sainsbury’s could readily be implemented in swathes more stores). ‘Lets just say there’s lots of growth for us within Tesco’, enthuses Cole.

‘We’re loss making at the moment’ – for 2005, Retec sales sparked 66% higher to £1.7m, and pre-tax losses were culled by 28% to £858,000 – ‘but we’ll be in profit by the end of the year as we are back-end loaded, with our sales following the capital spend of major retailers’. Subject to the shareholder nod at an EGM in September, Elite Strategies will acquire Retec for an aggregate of £700,000 alongside a small funding, changing its name to the more apt Retec Digital. The shares are worth a speculation for investors that don't mind an element of risk.