Marwyn Materials shows 60% share price rise in an hour

If you were fleet-footed you could have made a massive 60% return on your capital within the space of just 10 minutes this morning.

To have put yourself in the right position you would have needed to have bought 10p shares in Marwyn Materials, a new company that floated on AIM (the junior portion of the Stock Exchange) beforehand.

When trading got under way at 8am, dealers were pricing shares at 14p and within 10 minutes they had lifted to 16p. Now bad when elsewhere there is so much doom and gloom.

As a result of successfully offering and selling 136m shares for 10p, Marwyn Materials has a spending fund of £13m and it is hankering after snapping up building material businesses, both listed and unquoted.

Peter Tom is chairman of the new company. He has more than 50 years’ experience in the aggregates industry after joining Bardon Hill Quarries as a school-leaver in 1956. He became chief executive of the Bardon Group in 1985 and then oversaw its transition into a publicly-listed materials group.

Tom expanded by way of acquisitions in America in the late 80s. The merger of Bardon and Evered in 1991, followed by that enlarged group’s merger with Camas in 1997 resulted in the formation of Aggregate Industries.

In 2005, that business was swallowed by Holcim, the Swiss building materials group at a price of £1.8bn.

A spokesman said the surge in share price to 16p reflected, in part, the tight liquidity in Marwyn’s shares (i.e. only a small percentage are available for trading on the Stock Exchange).

He declined to say what percentage is held by directors and investor group Marwyn Capital.

The euphoria for the newcomer’s shares didn’t last all that long, however, and by mid-day shares were trading at 11p -enough to have the faint-hearted already thinking of bailing out. Still it was a marvellous burst of sunshine in the middle of gloomy times.