News

January 28, 2008

Aricom Working Steadily Towards Developing Two Major Iron Ore Projects In Russia

Alastair Ford

Shares in the Russian-focussed iron ore and titanium developer Aricom took a battering in the market turmoil last week, as the company loomed uncomfortably large amongst the biggest fallers on the FTSE 250 on the 22nd January. But it was all about the market, rather than anything specifically to do with Aricom, and chief executive Jay Hambro remains fairly sanguine about the volatility. For one thing, he points out that although Aricom is now firmly ensconced on the main board, many of his shareholders are still representative of a certain type of Aim-focussed investor that will sell into a falling market to meet redemptions, and who, due to the nature of an Aim-focussed portfolio, will sell the most liquid companies first and most heavily.

Furthermore, Aricom’s shares have recovered some of the lost ground since the initial tumble. This is partly because the wider market steadied somewhat, but also, Mr Hambro believes, because many of the tracker funds that have had Aricom on their shopping lists since its elevation into the FTSE 250 are taking advantage of the weaker price. It’s not clear how many trackers have yet to buy in, but Mr Hambro believes the process has some way to run yet. So there’s a natural support there, further...