Inspicio Share Discussion Threads

[bigbigdave] 16/2/2006 06:46

Down as a buy in shares rag

[huwrayhenry] 19/1/2006 17:14

guys keep tis one quite..want to buy a load more shares!
HH

[jonwig] 19/1/2006 14:28

Strange, trade was marked at 08:01 as a 'late' trade (L) - so delayed from when?
Forgive me for being suspicious ...

The Company was informed that Keith Tozzi, Non-Executive Chairman, acquired
5,895 ordinary shares of 10 pence each ('Ordinary Shares') on 19 January 2006.
The Ordinary Shares were bought at 114 pence each and, following this
acquisition, he now holds a total of 118,395 Ordinary Shares, which represents
approximately 0.215 per cent. of the Company's issued share capital.

[jonwig] 19/1/2006 12:30

Hello, Harrogate.

Good luck (both of us!).
This might be worth a read -

[harrogate] 19/1/2006 12:20

Thanks for starting this thread

Have just bought a few at 1.20 - missed out a few weeks ago when i first looked - Very positive statement and I like the management

I think they will do well - it is a good market - The competition - Intertek and SGS are both big and a bit lumbering so I think there is scope for the inspectorate business to start recovering some of its former glory

Always a chance of a deal with the big players in due course as well

[jonwig] 19/1/2006 08:42

Very bullish Trading Statement this morning - looks as though on track for successful reorganisation of Inspectorate, new blue-chip clients, possible further acquisitions.
Have bought a few, just hope this uptrend isn't a second 'ironing board' ...

[rarther] 18/11/2005 11:40

always been a fan of the 'ironing board' chart formation.

[jonwig] 18/11/2005 11:36

Copied from elsewhere:

Mark Silver trained as a chartered account at Price Waterhouse and then worked at Aegis, the media buyer, for eight years before becoming finance director of Pearson professional.

The story gets a little more relevant to his present position when he joined BSI (the British Standards Institute) in 1998 as finance director. The objective at that time was to turn it from a public sector body into a commercial organisation, with the ultimate goal of a public listing.
Inspectorate bought by BSI

In the course of this journey, two things happened. One was that BSI bought a business called Inspectorate, which is involved in industrial measurement and testing. The aim was that by injecting a commercial organisation into BSI it would ease the transformation to a public listing. It did not happen.

In fact the reverse happened. Inspectorate succumbed to the dead hand of the public sector, it became clear that BSI would never float, and Mark Silver and his colleague Keith Tozzi left to do other things. "I did not join BSI to become a civil servant," says Silver.
Inspicio cash shell floated

Fast forward to April 2005, when Inspicio (the Latin verb for 'to inspect') was floated, with Tozzi and Silver as prime movers, as a cash shell on AIM with a brief to buy businesses in the inspection area. No surprise then that in early October Inspicio announced a deal to buy Inspectorate out of BSI for £52m plus the assuming of a further £20m of debt.

It was not a foregone conclusion. Silver says: "we had five or ten candidates in mind. But Inspectorate was our favourite, because we knew the business well and it was not performing particularly well."
Inspicio wins Inspectorate

Inspicio won out in an auction to buy the business in competition with a number of private equity houses. A big help in what turned out to be tortuous negotiations was that the duo knew the business inside out, and was the favoured partner for a number of middle managers within the business. That is important, says Silver, "because the business needs good managers on the ground".

What do the numbers look like? According to Silver there is considerable potential. "Inspectorate was basically breaking even. Historically it had pre-tax margins of around 8% on sales, and we think we can get back to that sort of figure over a two-year period."
Restructuring and de-layering

Restructuring and what Silver describes as de-layering will form part of this. Apart from those likely to fall victim to this process, Silver says, "the management team is relieved. They hated BSI, who effectively de-commercialised the business. We are a known quantity".
Bolt-on acquisitions

Aside from the turnaround story, Inspectorate is likely to form a platform for a number of bolt-on acquisitions in the same business. "There is an increase in regulation in many markets," says Silver. This applies to oil and gas, where many more tests now have to be carried out, through to markets such as food. "I think the acquisitions we make will get us into new industries. We see Inspectorate as forming one division of the company. Ultimately we might have two or three legs. But we are not going to go mad."
IT improvements

One attraction of the Inspectorate business was that capital had been lavished on the company's labs, but little has been spent on IT. Information management systems in the labs should result in more efficient deployment of skilled staff, while simplifying accounting and information management systems and better tax planning should yield considerable improvements on top.

Silver reckons that initial restructuring will provide a chunk of margin improvement. "We think we can get to margins in the 4-5% region next year," he says. Over and above this, growth is expected to come from an underlying increase in world trade that he puts around 7% a year. Most of the demand for testing comes when goods and commodities cross international borders.
Stock market potential

According to Silver, the potential for the group in stock markets becomes clear when one looks at the ratings on similar companies. He notes that Intertek, a broadly similar business, at least in the oil testing area, sells at 11 times EBITDA. Take turnover of around £100m, operating margins of 9%, throw in a little depreciation, multiply the total by 11 and you get to a projected market value in two years, when the restructuring and margin recovery is complete, of about £100m. The company's current market value of around £60m.

I should decide whether to buy this, with all the positive news about!

[shuisky] 18/11/2005 08:56

I was expecting a bit of action here after yesterdays analyst meeting. Perhaps it will take a few days to filter through. worth keeping an eye on to see how the co managed to convince the city. The upside potential is considerable, but this is a punt based on the credibility of the management, IMHO. I don't hold any stock.

[jonwig] 12/11/2005 11:12

Peter Temple writes in today's FT that he's taken a stake, citing as reasons basically the story repeated in the Shares Mag article.
Since he has quite a following, I'd expect a mark-up on Monday morning.

My own stake here hasn't been taken, and maybe never will.

[jonwig] 12/11/2005 11:10

Shares Mag, 13 Oct 2005:

A rapid round of cost cutting could double the value of Inspicio (INP:AIM) within 18 months. Until now a cash shell, Inspicio is
expected to complete the acquisition of oil and gas testing
outfit Inspectorate today (13 October).
Should the deal go ahead management will seek to rapidly
streamline the Inspectorate business, aiming for an 8% operating
margin within 18 months. If the turnaround is successful Inspicio may
be able to demand a similar valuation to rival Intertek (ITRK).
That would double the market capitalisation of Inspicio, expected to
be around the £50 million mark following today's completion, to
around £100 million. Inspicio chief executive Mark Silver certainly has a
head start on Inspectorate's workings.
He used to oversee the business, which tests the purity of oil
supplies for clients such as BP, when he was the finance director of
BSI, Inspectorate's former owner. Silver says: 'We know the business
well and are confident it can deliver an operating margin of 8%.'
The potential £100 million market cap is based on Intertek's
valuation as a multiple of its earnings before interest, tax, depreciation
and amortisation (EBITDA). With a market cap of £1.1 billion and having
made EBITDA of £102.4 million in 2004 the multiple is around 11.
Intertek's comparable business with Inspicio, the Caleb Brett testing
division, generated an operating margin of 8.9% at the half year.
Assuming Inspicio can hit 8% operating margin and turnover remains
at the current £100 million then EBITDA will be around £10 million.
Applying a multiple of 10 times, given Inspicio's lower operating
margin compared with Caleb Brett, would justify a market
capitalisation of £100 million. But even £100 million is a conservative
estimate since Inspicio's EBITDA figure assumes depreciation of
£2 million when it could, according to house broker Baird, be closer to
£4 million.

All the above is in the re-admission RNS, and so adds nothing new.

[jonwig] 12/11/2005 11:05

There have been quite a few holdings shuffled about since suspension lifted.
These are current significant holdings.
I took as starting point the information in the prospectus, then tracked through the RNSs and re-adjusted for the placing of 55m new shares.
Obviously the smaller holdings may be inaccurate.
JOHCM Managers is one which had no holding in the initial placing, but has increased its stake three times since re-listing.

K Tozzi*.........25000 0.05
M Silver*...... 100000 0.18
C Slack*.........10000 0.02
M Watts*.........10000 0.02

JOHCM Mgrs.....4965000 9.03
Hndrson Global.4748000 8.63
Sun Life Canada1726744 3.14
Killick & Co... 480000 0.87
Aberdeen A M... 300000 0.55
Unicorn A M.... 300000 0.55
Morley Fund Mgrs250000 0.45
M D Barnard & Co200000 0.36
Artemis Inv Mgt 200000 0.36
RMB Multimgrs.. 200000 0.36
Marwyn Ventures 150000 0.27
Singer & Fr.... 150000 0.27
First State Inv 100000 0.18

Total 25.30%

[jonwig] 15/10/2005 08:14

News now, Regina!
Looks like I was asleep at the wheel on this one, with chance to buy in missed on Thursday and Friday mornings.

[regina124] 09/7/2005 18:12

Any news on the possible takeover, please???????????????????

[jonwig] 08/6/2005 07:50

Shares suspended pending news of possible reverse takeover.
I never bought them: looking at the chart, that seems sensible.
However, price may gap up now.

[jonwig] 29/4/2005 14:30

.

• Company website:





Floated on AIM at 100p, 29 April 2005.

Suspended 29 June 2005 owing to promised acquisition.

Re-listed 6 Oct 2005:
Acquisition of Inspectorate, the global inspection and testing group, for a cash consideration of £52 million, financed through the placing of 52,000,000 new Ordinary Shares at £1 per share, raising £52 million, and through £20million bank debt facilities.

Inspectorate is being acquired from BSI Group, which Mark Silver (CEO
of Inspicio) and Keith Tozzi (Chairman of Inspicio) ran between 1998 and 2000.

• Inspectorate website:

April 2006: acquisition of Environmental Services Group from Mowlem for £16m, including placing of 3.75m shares:

• ESG website:

July 2006: acquisition of Eclipse Scientific Group for £47m, issue of 27.2m shares and £22m debt.

• Eclipse website:

No. shares in issue (29/01/07):101,599,193.
J O Hambro Capital Mgmt ..4,236,806 4.2%
Cycladic Capital Mgmt ....6,506,500 6.4%
AXA Framlington ..........5,559,174 5.5%
Schroder Inv Mgt .........5,136,743 5.1%
HBOS .....................4,899,115 4.8%
F&C Asset Management .....4,796,568 4.7%
Credit Suisse Asset Mgt ..4,556,781 4.5%
SG Asset Management ......4,122,310 4.1%
Artemis Inv Mgt ..........3,476,000 3.4%
ZA Capital ...............2,960,000 2.9%
Goldman Sachs Asset Mgt ..2,803,404 2.8%
Berenberg Bank ...........2,740,000 2.8%
Polar Capital Partners ...2,718,600 2.7%

Other Directors
Mark Jonathan Silver ...... 187,500 0.2%
Keith Tozzi ............... 118,395 0.1%
Chris Slack ................ 15,000 0.0%
Mark Irvine Watts .......... 10,000 0.0%
Lesley James ................ 7,000 0.0%