Debt purchaser Arrow Global’s (ARW) £158 million takeover of Capquest (24 Sep) looks the stand out in a series of substantial deals in the small cap space.

Arrow’s planned acquisition of the UK debt management business adds 2.8 million customers, £4.1 billion in assets and is expected to enhance earnings by 3% in 2015 and 13% the year after, according to analysts at broker Jefferies. Another bonus is that Capquest chief executive officer Helen Ashton, previously managing director at Barclaycard, joins the business.

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Elsewhere paper and packaging group Powerflute (POWR:AIM) has proposed (30 Sep) a reverse takeover of Finnish coreboard producer Corenso for €81 million in a deal expected to be ‘immediately earnings enhancing’. Powerflute’s model is to buy unloved business and improve their operational efficiency. Corenso expands Powerflute’s product base and gives it a strategic position in the US and China.

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Medical device and drug maker Consort Medical (CSRT) steps up its plans to win more business from outsourcing drug companies through buying contract developer Aesica (30 Sep). The £230 million price tag is 80% of Consort’s £289.7 million cap and is part-funded by a 33.9% discounted £95.3 million rights issue.


Issue Date: 08 Oct 2014