23/05/2008
Equest Investments Balkans, which grew its assets by more than 30% last year on the back of Balkan consumer spending growth, is changing from a fund into a holding company to make its shares ‘more understandable’ to investors.
With investments in 12 companies spread between Bulgaria, Romania, Serbia and Montenegro, the new strategy is to sell around £90.7m of non-core assets and focus on nurturing the remaining portfolio. Equest plans to nurture these companies through to floatation, to fill what investment adviser Petri Karjalainen says is ‘a shortage of high-quality, blue-chip, regional champions coming to market from the Balkans’.
A core driver of recent asset growth has been large electronic retailer TechnomarketDomo, for which a flotation is planned ‘when the timing is right’. Other large holdings include Novera, a Bulgarian waste management concern, and Borovets, a resort development still in the early stages of construction.
The flotation of TechnomarketDomo, land value increases and changes to the euro-sterling rate are expected to ensure future value growth as the restructured company moves forward. Results for 2007 showed net asset value (NAV) up 31% to €23.40 (£18.62) and house broker KBC Peel Hunt values the shares at 2628p – significantly above the current 1032.5p.
Unlike other AIM-based investors in the region that are focusing mostly on property, Equest is exposed to the whole region and has a multi-sector focus. It could reward a speculation.
Growth Company Investor subscribers have full access to all our AIM and small-cap share recommendations. To subscribe today with a half-price offer, and gain immediate access to all the recommendations, click here.
| Market cap: | £178.87m |
| PE Forecast: | n/a |
| Share price: | 1032.5p |
| AIM | £63.93m |
350.00p
|
-20.00p
|
|
| Other company articles: |
| 23/05/2008 |
| 20/12/2006 |
Manage Your Finances
Money, tax and benefits : your official guide.
