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Elastic share price at GoIndustry

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GoIndustry-DoveBid, the industrial equipment and machinery auctioneer, said it did not know why its share price rose 40 per cent on Thursday, only to fall back 30 per cent on Friday.

The company issued a trading statement in response to its share price nearly doubling over the past two weeks on the back of takeover rumours.

GoIndustry-DoveBid confirmed that it is considering placing at a new equity at a “considerable” discount’ to its closing price on Thursday.

Jack Reinelt, chief executive, told the Financial Times: “We do not know of any legitimate reasons for the price change.”

The group has been reviewing the company’s funding needs and is exploring various possibilities to strengthen the balance sheet.

Mr Reinelt added that the group predicted a positive second quarter. “A lot of restructuring and a fair amount of cost cutting has reset the fixed cost base,” the group has cut £6m ($10m) of annual costs during the first quarter of 2009.

GoIndustry, which bought its US rival DoveBid last year, had been hit with a pre-tax loss of £28.9m last year.

While Mr Reinelt predicted that the “extremely difficult trading conditions continued through the first two months of 2009”, he said the group expected another loss as trading conditions of 2008 will offset the success of the second quarter of 2009.

GoIndustry-DoveBid shares fell ¾p to 1.88p.

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Written by Magda M Ali

January 21, 2010 at 11:51 pm

Posted in Uncategorized

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