Companies: PHC ��

Plant and soil specialist Plant Health Care (PHC) is launching its Myconate crop yield-increasing product in America and seeking alliances.

AIM-quoted PHC, which produces natural alternatives to synthetic soil and plant care products, raised �6.5 million at 65p the other day with a heavily oversubscribed placing handled by broker Evolution. John Brady, the Pittsburgh-based company's chief executive, says the money will help develop Myconate, a natural plant root compound which trials in the USA, Europe and Brazil have so far shown to increase corn yields by nine per cent and soya bean yields by 13 per cent without undesirable side effects.

These are several times the yield increases claimed by conventional products and take Myconate into commodity crops, which Brady calls the 'Holy Grail', and all at a competitive suggested price to farmers of $8 (�4.70p) to $8.5 an acre. 'We need to ally with a major seed or chemical company,' declares Brady, who says PHC is seeking to register Myconate in France, which grows 60 per cent of Europe's corn.

PHC, whose other projects include an earlier-stage product to extend the shelf life of leaf crops for salad, lost an unchanged $2.9 million (�1.7 million) last year on turnover up 19 per cent to $10.2 million, with cash down from $8 million to $894,000. The company reckons it should reach break even later this year or early next, with a big impact from Myconate expected in 2008.

At 75p, the shares look a fair medium-to-long-term bet.