Currently poised to emigrate from the Full List to AIM, technology consultancy Sagentia looks unfairly unappreciated by the market. At less than £10m, its market value represents only two thirds of its £14.6m of property assets and, if you include its £7.6m investment portfolio, loans and cash, Sagentia's shares trade at a significant discount to its shareholder funds of 8.1p per share.

Understandably there has been a bout of director buying in the past couple of months and new chief executive Dr Alistair Brown, stepping up from sales director, intends to sell off the company’s venture portfolio and move to AIM. He says the new focus is ‘on earnings rather than equity’.

The previous strategy had been to generate shareholder returns by creating spin-out companies, some of which still sit in the portfolio, such as AIM-listed CMR Fuel Cells. Once the venture capital subsidiary is sold off Sagentia will be left with a consultancy arm that last year generated a £500,000 profit from £17.9m of fee income.

Operations in the UK, the US, Germany, Hong Kong and Sweden engage in business consultancy and product development. Standout projects include a suite of digital products that have helped transform the prospects of toymaker Hornby, the launch of a mobile payment solution for Vodafone and a delivery system for AstraZeneca that generates Sagentia £500,000 of royalties a year.

A move to AIM by the end of June and the appointment of new broker Arbuthnot might help to garner some more attention from small-cap followers. The move might also see 48% shareholder Catella, a sister company of Ikea, reduce its stake. Speculative buy.

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