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Fairpoint Group Share Chat (FRP)



Share Price: 9.89Bid: 9.50Ask: 10.50Change: 0.00 (0.00%)No Movement on Fairpoint Group
Spread: 1.00Spread as %: 10.53%Open: 9.89High: 9.89Low: 9.89Yesterday’s Close: 9.89


Share Discussion for Fairpoint Group


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JoeAverage
Posts: 1
Off Topic
Opinion:No Opinion
Price:9.89
RE: Disposal
12 Jul '17
Must be circa £4m rent and bus.rates liability dodged by early lease exit. That can only be a good thing for the business as a whole, but at the cost of those staff in the Debt part of the operation.
 
AUNBoy
Posts: 713
Off Topic
Opinion:No Opinion
Price:9.89
Disposal
12 Jul '17
RNS - disposing IVA business as well as exiting the lease arrangements on Fairclough House.

Huge savings to be made here and perhaps some proceeds from the sale to help reduce debt.

There's still hope that there will be some value in the company when restructuring is complete.

Gla.
AUNBoy
Posts: 713
Off Topic
Opinion:No Opinion
Price:9.89
RE: Suspension
7 Jul '17
Sonny - all we can do is wait because no one but insiders really know exactly how bad the finances are.

You would have thought with the Doorway deal, they can now publish the 2016 accounts and wonder why they are delaying it further.
SonnyBurnett
Posts: 78
Off Topic
Opinion:No Opinion
Price:9.89
RE: Suspension
7 Jul '17
AUNBoy,

Of course the £5M is for Simpson Millar, why the hell would a law firm capital provider give millions to support a business they are shutting down and has no future, makes no sense whatsoever. The reason Simpson Millar requires a lot of funding is because part of the restructuring plan was they were also trying to reduce the number of legal staff by as much as 300 people which would certainly be a drain on cash due to redundancy payments and also shows the legal side of the company is not performing well either.

The debt at the end of 2016 was only a couple million higher than anticipated mainly due to the restructuring.
Debt started building long before the end of 2016 through the purchase of Colemans, Simpson Millar, merging the two and the regulatory impact on the debt business and big fat earn out payment to the legal top brass.

If investors were surprised by the year end debt position they should've done a bit more in the dyor department because the debt position could be seen from a mile away with a little dyor..lol

The share price nosedived due to the trading "materially below market expectations" and "significantly lower revenues" statements from the company. This is an illiquid share which can cause massive swings either up or down. Our largest shareholder has continued to hold (even added a bit) their position so the drop is mostly down to small private investors selling an illiquid share which caused the sharp drop.

"Because the finance deal only relates to Simpson Millar my guess is they are winding down other parts of the business that are unprofitable."

You don't have to "guess" on the winding down part. I have already stated they were winding down the non core debt business. This was also stated by the company. Their plan is to continue a legal services provider.

As for the capital injection:

They had several £M left under the current credit facility and now they have received £5M of fresh cash. Add to that the £5M in cost saving which according to them should be fully visible in H2 2017.
If this isn't enough to see them through to profitablity AUNBoy, it not only means they have been/still are burning millions at an alarming rate but also that the turnaround plan is a complete failure and that there is no viable business here.

I doubt that Doorway would have provided the extra millions if that were the case. Their return to profitablity should be in sight otherwise the business is doomed and Doorway are just throwing good money after bad and somehow i seriously doubt those guys are that stupid.
AUNBoy
Posts: 713
Off Topic
Opinion:No Opinion
Price:9.89
RE: Suspension
6 Jul '17
Sonny

"they should not require a fresh capital injection after the new £5M funding"

What makes you think this? Don't forget this is a facility only for Simpson Millar. IMO there is a lot of work to do before FRP can be financially stable. The main reason for capitulation of the sp was because of the huge debt (circa £20m) at the end of 2016 and the "markets" view that FRP would be unable to pay for it. Once they get debt down it will have a good chance to survive.

Of course we don't know if the debt has increased or decreased since 1st Jan 17. I would guess it increased and this is why AIB decided it no longer wanted to support FRP as it was deemed too risky for them.

Because the finance deal only relates to Simpson Millar my guess is they are winding down other parts of the business that are unprofitable. If this is the case then I would welcome it. I would like FRP to be purely a legal services business so they can be more focused.

All my opinions. Dyor.
SonnyBurnett
Posts: 78
Off Topic
Opinion:No Opinion
Price:9.89
RE: Suspension
6 Jul '17
The entire line of credit has been transferred and they have received a new £5M injection of capital.
The debt problem has been with this company for many years and they should not require a fresh capital injection after the new £5M funding, the only thing they have to do is turn profitable and start paying down debt, that's it.

The reason for a credit facility like this is to prevent share dilution.
They don't need a new backer as they are currently fully backed by Doorway Capital.
DYOR
AUNBoy
Posts: 713
Off Topic
Opinion:No Opinion
Price:9.89
RE: Suspension
6 Jul '17
All that's happened is the debt has been transferred to Doorway with a £5m receivables funding facility.

The debt problem is still with us and we need fresh injection of capital.

So FRP are not out of the woods and will need further support from backer(s).

IMO. As always do your own research.
SonnyBurnett
Posts: 78
Off Topic
Opinion:No Opinion
Price:9.89
RE: Suspension
6 Jul '17
Given that they have already found a new backer, why did you post that article?
AUNBoy
Posts: 713
Off Topic
Opinion:No Opinion
Price:9.89
RE: Suspension
5 Jul '17
FT article

"If Fairpoint cannot find new backers, it faces the end point."

https://www.google.co.uk/amp/s/amp.ft.com/content/533a8538-5c01-11e7-9bc8-8055f264aa8b

We know that. Let's just hope there's enough support from our Institutional Investors to keep the company ticking over and the strategy to concentrate on legal services bear fruit in time.

Gla.
AUNBoy
Posts: 713
Off Topic
Opinion:No Opinion
Price:9.89
Suspension
3 Jul '17
It might be a good idea to bring the debt under control before they restart trading.




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