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Daniel Stewart Securities

  • BY: Andrew Hore |
  • POSTED: 06/01/2010 |

Chief executive Peter Shea has added to his holding in Daniel Stewart Securities one week after the Aim adviser admitted that Cairo-based Prime Group was not going to inject £2.31m into the business.

This is Shea’s first share purchase since early September prior to the announcement of the link up with Prime. The Middle East investment bank was going to invest £2.31m in shares at 2.1p each. A circular was promised by Daniel Stewart but everything went quiet.

Just before the end of the year the broker announced that Prime and Daniel Stewart had undertaken due diligence on each other. A co-operation agreement is likely but no investment will be made by Prime. The two businesses are considering starting an asset management business and a private bank.

Shea acquired 1.5m shares at 1.25p each. This takes his stake to 15.06%. A few days before the original announcement of Prime’s proposed investment Shea acquired 350,000 shares at 2.875p each.

Cash has been a problem for Daniel Stewart. There was £881,000 in the bank at the end of September 2009. The operational cash flow in the six month period was £1.62m.

Daniel Stewart has signed a £1m, two-year unsecured credit facility to provide working capital. The primary provider is Swiss trust company FCI AG. This will help to cover some of the cash injection that would have come from Prime.

Even so, Daniel Stewart needs to reduce the cash outflow from operations.

The share price reacted positively to the chief executive‘s share purchase, rising by one-third to 2p. That values Daniel Stewart at £6.26m.

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