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DCD Media

  • BY: Andrew Hore |
  • POSTED: 08/02/2012 |

AIM-quoted Timeweave has bought convertible loan notes in DCD Media that can convert into a 29.9% stake in the TV programmes producer.

Timeweave, formerly known as Alphameric, paid £2.87m for £3.068m of convertibles. They were bought from a number of institutional investors. They include Henderson and Universities Superannuation Scheme, which are major holders of the ordinary shares - 28.7% and 3.04% of DCD respectively. They have benefited from the resulting share price rise from 3.42p to 8.12p, which values DCD at £10.8m. At the beginning of the year the share price was 1.15p and last autumn DCD raised £775,000 at 1p a share. Henderson bought 27.5m of its DCD shares in that placing.

The 8% loan notes mature on 1 October. DCD is unlikely to be able to afford to repay the loan notes without a significant fundraising.

The conversion price of £2.093m of the loan notes is 18p a share (11.63m shares) but the other £975,000 are convertible at 1p a share (97.5m). There are currently 139.1m shares in issue so Timeweave could not convert all of the loan notes because that would give it more than 29.9% of the enlarged share capital. It could convert enough to give it nearly 60m shares given the current share capital. Those 60m shares are currently worth around £4.8m.

Timeweave owns 50% of Amalgamated Racing (AMRAC), which owns the rights to broadcast horse races from 34 racecourses, and sports hedging business SportingWins, but it is effectively a shell following the sale of its betting systems business. There was £28.5m of cash in the balance sheet at the end of June 2011, although SportingWins was subsequently acquired for an undisclosed amount. In July 2011, Timeweave received a £1.4m dividend from AMRAC.

Timeweave says that it has been following DCD, whose programmes include Bridezillas and Richard Hammond’s Blast Lab, for some time. DCD says that it looks forward to meeting with Timeweave and finding out about its plans.

Download the latest AIM Journal from http://www.hubinvest.com/AIMPDFJanuary2012_28.pdf

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