Pallet manufacturer and rental group RM2 International (RM2:AIM) makes an impressive stockmarket debut with a 20% rise to 105.5p. The group has raised £137.2 million to help increase its production capacity and have a pool of pallets to rent to customers in such sectors as food, drink, pharmaceuticals and technology.
RM2 has developed a new form of pallets that it claims are more robust and last longer than traditional wood products.
There's big names on the board including former Marks & Spencer (MKS) boss Stuart Rose, Paul Walsh who is ex-chief executive of Diageo (DGE) and incoming chairman of catering group Compass (CPG). RM2's chief executive John Walsh (pictured above) is a former investment banker.
We published a swot analysis on the stock and fleshed out its growth plans in last week's issue of Shares, saying to buy the shares on day one.
We like the company's strong cash position, big customer names and well-connected board.
As we highlight in the article, longer-term this could be an attractive dividend stock because of the significant cash flow potential from pallet rental agreements. You'll need to be a subscriber to read the full story. Those not already signed up can get an introductory offer via this link.
The business raised cash at 88p. Today's share price rise means RM2 is now valued at £334 million. The Daily Mail has picked RM2 as one of its top share tips for 2014.