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VECTURA (VEC.LN) shares rose Thursday after Citi initiated coverage with a "buy" rating, saying it has "transformational" asthma and other respiratory medicine assets in its pipeline and will benefit from positive market trends in the respiratory medicine market.

Citi analysts said Vectura's VR315, believed to be a generic version of GlaxoSmithKline's (GSK.LN) blockbuster Advair, is "the jewel in the crown."

Citi analysts expect VR315 launch in Europe and U.S. by 2013 and forecast combined peak sales from both territories of almost $2 billion.

At 1427 GMT, shares +7.2 pence, or 9.4%, at 83.5 pence.

MOUCHEL GROUP PLC (MCHL.LN), a U.K. consulting and business services group, Thursday said it is confident of continuing revenue from public sector-funded projects, despite wider concern in the market that the U.K.'s huge government deficit will ultimately lead to slashed budgets.

The vital services and essential infrastructure work Mouchel carries out are unlikely to be affected, Chief Executive Richard Cuthbert told Dow Jones Newswires.

At 1428 GMT, shares +13.7 pence, or 7.9%, at 187.5 pence.

VERNALIS PLC (VER.LN), a U.K. biotech firm, has inked a deal with pharmaceutical giant GlaxoSmithKline PLC (GSK.LN) to develop new cancer drugs, in an agreement potentially worth up to $200 million to Vernalis.

GlaxoSmithKline has taken an option to license any experimental new drugs developed by Vernalis designed to affect an undisclosed cancer target, the companies said.

At 1428 GMT, shares +8.25 pence, or 9.9%, at 92 pence.

MINORPLANET SYSTEMS PLC (MPS.LN), a vehicle management software company, Thursday said it has reached deals over its borrowings and is seeking to raise GBP3.25 million from shareholders, as it attempts to shore up its financial position amid tough trading conditions.

At 1429 GMT, shares -0.62 pence, or 22% at 2.25 pence.

GULF KEYSTONE PETROLEUM LTD. (GKP.LN) said it made a significant oil discovery in Iraq.

The company said it found oil at the Shaikan-1 exploration well in Iraq's Kurdistan region.

Preliminary tests indicate the well could produce 5,000 to 8,000 barrels of oil a day, Gulf Keystone said.

At 1429 GMT, shares +13.5 pence, more than doubling, at 26.5 pence.

MECOM GROUP PLC (MEC.LN), a European newspaper publisher, said the move to get its journalists writing more content across different platforms wasn't solely prompted by a need for increased efficiency during the global downturn, but instead follows the direction of the publishing industry as a whole.

Earlier Thursday, the firm said it planned to continue cutting costs, which are expected to save it EUR100 million in 2009, in an attempt to offset plunging advertising sales.

At 1430 GMT, shares -8 pence, or 7%, at 107 pence.

FIBERWEB PLC (FWEB.LN) said it has stepped up production of a component used in face masks, as the swine flu pandemic has led to a surge in demand.

The specialist fabrics maker earlier swung to a first-half loss after a string of charges and write-downs, but said that although sales fell in the period, it has seen signs of market volumes stabilizing.

At 1430 GMT, shares -4.5 pence, or 6.9%, at 61 pence.

GW PHARMACEUTICALS PLC (GWP.LN), a U.K. drug maker, Thursday said it raised $11.2 million from investors including U.S. healthcare fund group Great Point Partners, which requested a significant equity stake.

GW Pharma, which is developing drugs derived from cannabis, said Great Point Partners bought 7.6 million shares in the company at 78 pence a share, a 2% premium to the closing price Wednesday.

The purchase gives Great Point a 5.8% stake in GW.

David Kroin, a founder and co-portfolio manager at Great Point, said the U.S. investor has been following GW "for some time."

At 1430 GMT, shares +5 pence, or 6.6%, at 81 pence.

COSALT PLC (CSLT.LN) said it is seeking to raise GBP18.9 million in a steeply discounted share issue in a bid to cut its debt.

The marine safety equipment maker said it intends to issue 180 million shares through a placing and open offer and another 198 million in a firm placing, both at 5 pence a share, an 84% discount to Wednesday's closing price.

At 1431 GMT, shares -17.25 pence, or 56%, at 13.75 pence.

INDIGOVISION GROUP PLC (IND.LN) said it expects its fiscal 2009 operating profit to be "materially ahead" of market expectations and will post sales up around 43% on year, due to strong sales to casinos, banks and the U.S.-Canada border crossings.

The video security systems supplier said its operating profit performance has been helped by an improvement in its operating margin.

At 1431 GMT, shares +77.5 pence, or 19%, at 482.5 pence.

FTSE SMALL CAP +1.5%

FTSE AIM +0.9%

FTSE 250 +1%

-By Hannah Benjamin, Jason Douglas and Rachael Gormley, Dow Jones Newswires; 44-20-7842-9272; uksmallcaps@dowjones.com

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