The risks are mainly centred on the execution of the settlement and the reliability of the management in the repayment of capital. The "market" seems to be rather sceptical here. Whether rightly or not is the question.
Hi Michael. I would disagree. It has been pretty clear that the (new) CEO's main task was to liquidate the company. That's what happened. The company has also regularly stated that they would return the proceeds, after costs. That's starting Q4. At today's level the market is discounting some uncertainties regarding taxes (if any), low liquidity, but mainly uncertainty regarding the earn outs - which makes sense.
Interesting point, I am very new to special situation so maybe still a bit naive. I feal with management running the sale and announcing the delisting around may 25, there is okay transparency.
I personally don't like that the terms of the contingency payments are very unclear.
I understand that the payout after costs is only about £30 million. So Iggy was too optimistic. The current MC of about 25 Mio. looks now reasonable related to the risk.
The risks are mainly centred on the execution of the settlement and the reliability of the management in the repayment of capital. The "market" seems to be rather sceptical here. Whether rightly or not is the question.
Hi Michael. I would disagree. It has been pretty clear that the (new) CEO's main task was to liquidate the company. That's what happened. The company has also regularly stated that they would return the proceeds, after costs. That's starting Q4. At today's level the market is discounting some uncertainties regarding taxes (if any), low liquidity, but mainly uncertainty regarding the earn outs - which makes sense.
Interesting point, I am very new to special situation so maybe still a bit naive. I feal with management running the sale and announcing the delisting around may 25, there is okay transparency.
I personally don't like that the terms of the contingency payments are very unclear.
Would the negative working capital not have an impact on your calculations?
You mean the working capital they Retain for the run of business?
I see 6.4m of trade payables in 30June accounts. I would have thought this would be deducted, but not sure
Any view on this?
Interesting setup. Thanks for bringing it to attention.
Any updates on the current state? Not safe anymore?
do you know why the stock price did decline today (it seems that this is related to the Update on distribution of capital) ?
Yep management are screwing shareholders. Massive redundancy payments suddenly appearing from nowhere.
I understand that the payout after costs is only about £30 million. So Iggy was too optimistic. The current MC of about 25 Mio. looks now reasonable related to the risk.
How do they return the capital? If they pay a dividend, wouldn't a withholding tax eat most of your returns?
it's UK listed. UK companies do not pay withholding taxes, as far as I know.