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Abramovich doubles stake in biofuels minnow

Abramovich doubles stake in biofuels minnow

Chelsea-owner Roman Abramovich has bitten off another big chunk of biofuels company Velocys having near-doubled his stake in the business over the past month.

Abramovich, via his Ervington Investments vehicle, upped his holding in the company from 7.75 million shares to 9.02 million or 7.71% worth £19.94 million at a share price of 221p.

The announcement went out to the market following Wednesday’s close. In early trading on Thursday shares in the business were up 6.01%, with additional impetus from the initiation of coverage by broker Cannacord Genuity as a speculative buy on a price target of 400p.

Numis rates the company a buy with a price target of 227p. Abramovich’s purchase puts him among the top four investors in the company, behind Lansdowne Partners, Citywire AA-rated Henderson UK Equity Income manager James Henderson and Ruffer.

Since he initially invested in the business at the  end of 2012 shares have risen just over 50%.

Previously known as Oxford Catalysts, the company converts waste-generated methane gas into liquid fuels.

The company is currently in the planning stages to build Europe’s first waste-biomass to jet fuel plant outside London, in association with British Airways.  

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