Two directors of commercial electric vehicles manufacturer Tanfield have added to their holdings and sparked a jump in the share price.
The shares have risen by one-third to 19.75p each. AIM-quoted Tanfield raised £1.8m after expenses from a recent open offer to shareholders at 10p a share but this cash will not last long if it does not reduce the cash outflow from operations.
Chief executive Darren Kell bought 1.25m shares at 13.7p each, for a total cost of £171,250. He owns 3.66% of Tanfield.
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Non-executive director Roy Stanley bought the same number of shares but managed to get them at 13.2p a share. That cost £165,000 and took his stake to 13.16%.
Both men took up their open offer entitlement and were involved in underwriting the offer.
Three other directors have also made more modest additions to their shareholdings.
Net cash fell from £4.77m to £1.81m in the first six months of 2010. If the open offer cash is added to the money in the bank at the end of June that does not come to much more than the cash outflow in the first half.
The cash injection is needed to finance the group until it merges its UK electric vehicles business with its US associate company.
Tanfield has signed non-binding heads of agreement with US-based associate Smiths Electric Vehicles US (SEV US) about a proposed merger with Tanfield's UK-based subsidiary Smiths Electric Vehicles. SEV US is considering a Nasdaq flotation as part of that deal but that is unlikely to happen until the first half of 2011.
Tanfield wants to retain a large stake in the merged business but the powered access business that will then become its core business. That continues to lose money and is the main reason for the cash outflow.
Top Director Buys
Tanfield Group(TAN) Director name: Mr Darren KellAmount purchased: 1,250,00 @ 13.70p Value: £171,250
Tanfield Group(TAN) Director name: Mr Roy StanleyAmount purchased: 1,250,00 @ 13.20p Value: £165,000
Alternative Asset Opportunities PCC (TLI) Director name: Mr John ScottAmount purchased: 89,697 @ 56.50p Value: £50,679
Anglo American (AAL) Director name: Sir John ParkerAmount purchased: 945 @ 2,537.60p Value: £23,980
4imprint Group (FOUR) Director name: Mr John Poulter Amount purchased: 10,000 @ 214.00p Value: £21,400
Promethean (PTH) Director name: Sir Sir Peter BurtAmount purchased: 50,000 @ 33.00p Value: £16,500
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