Corporate action dominates this morning's small-cap news, led by an escalating takeover contest for Pharos Energy and a batch of strong first-half results across financial services and consumer goods. Resource explorers were also busy, with drilling updates spanning Zambia, Chile, Namibia and Morocco, while deal-making extended into soft drinks and airport security technology.
Serica holds line on Pharos bid despite Ratio's higher offer
Serica Energy (AIM:SQZ) has declared its recommended cash offer for Pharos Energy final, refusing to match a higher rival bid tabled by Ratio Petroleum Energy LP. Ratio raised its own offer on 7 August, saying it had secured irrevocable undertakings covering roughly 41.76% of Pharos' issued share capital, putting pressure on Serica's board to respond. Serica has declined to do so.
Serica's offer, set out on 26 July, remains pitched at 32.6683p per Pharos share, comprising 28.6683p in cash plus a 4.0p special dividend. The UK North Sea-focused producer said it takes "a highly disciplined approach to M&A" and continues to evaluate other opportunities in the North Sea and elsewhere. It has reserved the right to revise its offer only if a third party other than Ratio announces a competing bid for Pharos, or if the Takeover Panel grants consent in what it called wholly exceptional circumstances.
"The Board and Hg believe that the current share price undervalues the HgT portfolio and its future prospects," said Jim Strang, Chairman.
Serica's refusal to raise its bid reflects confidence in its balance sheet, the company completed a $750m refinancing on 23 July and reported $184m of free cash flow in H1 2026, but it also signals the board sees better returns deploying capital elsewhere in the North Sea rather than overpaying for Pharos. The outcome is now binary: either Serica wins at its stated price, or Ratio converts its shareholder support into a successful takeover and Serica walks away empty-handed. The disciplined stance protects Serica's own balance sheet regardless of which way the contest breaks.
HgCapital Trust asset value steadies as trading offsets software rating fall
HgCapital Trust (LSE:HGT) posted an estimated net asset value per share of 530.7p at 30 June, with a total return of 0.5% in the second quarter following a sharper 5.4% decline in the first. That left the closed-end investment trust, which gives shareholders exposure to a portfolio of unquoted European technology companies managed by Hg, with a total return of -4.9% for the first half. Underlying portfolio trading added 11% to NAV over the period, but a fall in comparable company valuation multiples cut it by 13%, as investors grew cautious about AI's impact on software business models.
The weighted average valuation multiple across the portfolio fell to 22.9 times EBITDA, from 25.2 times at the end of December, even as revenue and EBITDA grew 16% and 19% respectively on a last-twelve-month basis, with organic growth of 11% and 17%. HgT invested £146m in the period, including new stakes in OneStream and Rightsline.
The divergence between operating performance and valuation multiples is the story here: the underlying businesses are growing faster than the market is willing to pay for them, and the board's public position, that the current share price undervalues the portfolio, signals it expects the rating gap to close as the AI-driven software de-rating proves overdone.
Plus500 posts three-year high H1 revenue
Plus500 (LSE:PLUS) reported revenue of $462.9m for the six months to 30 June, up 12% year-on-year and the strongest first-half figure in three years. Customer income rose 24% to $460.8m, a five-year high for the period, while trading income climbed 15% to $441.8m, as the London-listed group's proprietary trading platforms across contracts for difference, share dealing and futures drew higher engagement.
EBITDA rose just 1% to $187.5m, held back by increased customer acquisition spending, scaling costs in its US business and a stronger Israeli shekel against the dollar. Basic earnings per share still grew 6% to $2.17, aided by ongoing share buybacks. The non-OTC business, covering futures and the newly launched CFTC-regulated prediction markets offering, grew revenue by roughly 30% and now contributes roughly 15% of group revenue, up from 13% a year earlier. The company announced $182.5m in shareholder returns, split between a $100m buyback and $82.5m in dividends. "H1 2026 was an outstanding period for Plus500... marking a genuine step-change for our US business," said David Zruia, Chief Executive.
The margin compression from US scaling costs is the trade-off for diversification: Plus500 is deliberately sacrificing near-term EBITDA growth to build out a business less dependent on traditional CFD trading, and the early traction in prediction markets and futures suggests that bet is starting to pay off.
ECR Minerals raises new capital to push Maddens gold towards production
ECR Minerals (AIM:ECR) has conditionally raised £636,250 before expenses through a placing with existing shareholders and other investors, issuing 363.57m new shares at 0.175p each, a 12.5% discount to the prior closing price. The gold exploration and development company, focused on Australia, will direct most of the net proceeds toward the Maddens Gold Project in Northern Queensland, where ECR holds a 50% interest and has recently identified an additional mineralised quartz vein containing visible gold.
The funds will support continued development of the Maddens Underground Mine, processing of ore already stockpiled on the run-of-mine pad, and trial alluvial mining within the Brothers Mining Lease area using equipment redeployed from Raglan. A further portion covers exploration following a completed LiDAR survey, which has pointed to potential extensions of the Maddens mineralised system toward the historic Sisters Mine.
The discount reflects the realities of small-cap gold financing, but the redeployment of Raglan equipment into Brothers Mining Lease trial mining signals ECR is trying to generate near-term cash flow rather than fund exploration alone, a pragmatic shift for a company working toward production rather than discovery.
Marshalls lifts H1 profit as cost cuts offset weak markets
Marshalls (LSE:MSLH) grew adjusted operating profit 8.1% in the first half as its Landscaping Products turnaround plan began delivering savings, even as revenue held broadly flat and end markets stayed subdued.
The gap between flat revenue and rising profit points to self-help rather than market recovery: Marshalls is extracting margin from cost discipline while waiting for construction and landscaping demand to turn, a strategy that protects earnings but leaves the company exposed if the turnaround plan's savings prove one-off rather than structural.
Nichols buys VITHIT for €75m in earnings-boosting deal
Nichols (AIM:NICL) has acquired functional soft drinks brand VITHIT for €75m in cash, a deal it says will lift earnings from day one. The Vimto owner is extending its portfolio beyond its core carbonated and still drinks range into the faster-growing functional beverages category.
An immediately earnings-accretive acquisition signals Nichols is confident in VITHIT's growth trajectory and integration economics rather than paying for a turnaround story, positioning the group to capture demand in a category outperforming traditional soft drinks.
Thruvision lands South-East Asian airport screening deal
Thruvision Group (AIM:THRU)'s regional partner has secured a contract to deploy the group's worker-screening technology across multiple South-East Asian airports, its largest deployment in Asia to date, worth £3m.
The multi-airport scale of the contract suggests Thruvision's screening technology is moving from pilot deployments to standardised procurement across an aviation security market, a shift that could support recurring regional demand beyond this single deal.
Aterian starts AI-guided drone survey in Botswana copper belt
Aterian (AIM:ATN) has begun a high-resolution drone magnetic survey over its top two Kalahari Copper Belt licences, feeding data into its AI exploration partnership with Lithosquare.
Pairing aerial survey data with AI-driven target generation is intended to sharpen drill targeting ahead of any future programme, a lower-cost way for Aterian to de-risk exploration before committing capital to drilling.
ValiRx subsidiary secures second European patent notice
ValiRx (AIM:VAL) subsidiary Cytolytix has received a notice of intention to grant a second European patent, adding to the group's cancer therapeutics intellectual property portfolio ahead of formal grant.
A second European patent notice strengthens Cytolytix's protective position across multiple jurisdictions, an incremental but meaningful step in building the IP estate that underpins ValiRx's licensing and partnership strategy.
Tertiary Minerals completes Phase 4 drilling at Mushima North
Tertiary Minerals (AIM:TYM) has completed Phase 4 drilling at Mushima North in Zambia, with preliminary results from Target A1 supporting both the near-surface silver exploration target and a higher-grade silver-copper zone within it.
Confirmation of a higher-grade zone nested within the broader silver target gives Tertiary Minerals a more defined focus for follow-up work, potentially concentrating future drilling on the richer intercepts rather than the wider low-grade envelope.
Xtract Resources advances Amghas antimony mine towards plant commissioning
Xtract Resources (AIM:XTR) has appointed local mining and civil contractors to prepare its Amghas antimony project in Morocco for construction of a 70,000 tonnes per annum gravity processing plant.
Moving from permitting into contractor appointment marks a tangible step toward production for Xtract, with antimony's status as a critical mineral for defence and battery applications adding strategic weight to the project's timeline.
Galantas expands Indiana drill programme to 12,500 metres
Galantas Gold (TSXV:GAL) is extending exploration at its Indiana gold-copper project in Chile after visual signs of new mineralisation styles, funding the expansion from existing cash.
Funding the extension internally rather than through fresh equity preserves shareholder value while the company chases confirmation of the newly observed mineralisation styles, a low-dilution route to potentially expanding the resource base.
Kendrick Resources reports high-grade REE hits at Teufelskuppe
Kendrick Resources (AIM:KEN) reported new diamond drilling results at the Teufelskuppe project in Namibia, delivering light rare earth oxide grades of up to 5.80% over continuous widths exceeding 36 metres.
Grades and widths of this scale are notable for a rare earth project at this stage, giving Kendrick a strong early data point to build a resource case roughly as it advances the Namibian asset.
Dekel palm oil output falls as cashew plant hits record
Dekel Agri-Vision (AIM:DKL) saw crude palm oil production drop 15.4% in July on seasonal lows, while its cashew plant processed a record 800 tonnes and palm kernel oil sales surged.
The seasonal palm oil dip is offset by diversification bearing fruit: record cashew processing volumes suggest Dekel's investment in broadening beyond palm oil is beginning to smooth out the seasonal volatility inherent in its core crop.
