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Maybe a last ditch attempt to win more favour. I can only guess it will be positive otherwise it would be foolish to damn themselves just before the gm.
Interesting that GMS has just said they will interim results in the morning, just hours before the GM.
My first sentence should have read 'If the parties that coincidentally voted the same way vote in favor of the Seafox resolutions...'
If the parties that coincidentally voted the same way (apparently Seafox provided sufficient evidence to prove the parties weren't acting in concert, but I still don't buy it) then I don't think there's any chance of stopping the resolution going ahead. The question is what happens when the two new members join the board? With the GMS board going 'against shareholders wishes' and retaining two of the members of the board who were voted out, then the two new board members would be the minority (I think Seafox's original plan was to shrink the board so their nominees would form a larger proportion). The best case scenario is they actuall honor their word and help the company in the best interest of shareholders, failing that they allow Seafox to make another bid at their highest price paid (22p) and the worst case scenario is they try and sabotage GMS to devalue it. All IMO, DYOR etc.
Any thoughts on how this is going to play out tomorrow? Was interesting to note that release last week on the bank's support for the current board and their statement that there won't be any negotiations on the restructuring.....
driveat15, I agree that Seafox was indeed the catalyst for the direction the Company has moved in; credit where credit is due. Fundamentally however, I feel they are a competitor and they have absolutely demonstrated that they want to own the company and they want it cheap. As a SH, I feel having them on the board is not in my best interest. Being in a position to negatively affect the SP to facilitate their takeover of the company as cheap as possible should absolutely be resisted, and having seats on the BoD goes a long way in helping them achieve that takeover. To be clear, I fully understand that all public companies are ‘for sale’. The job of the BoD and the Chairman is to ensure that ALL SH’s get fair value and resisting Seafox representation on the BoD is a key part of that IMHO.
@driveat - very valid argument that Seafox stake helped push the board level changes and the management change last year (FYI I did vote for them in that AGM). However, s**t had hit the fan in late December 2018 (pre Seafox entry) and the changes were bound to happen as well with banks breathing down their neck.
But on this vote, if I were Mazrui, I would vote against it and make Seafox pay a premium to buy me out when the 6month standstill ends......unless of course Mazrui wants to stay invested with whatever value creation plans Seafox brings to the table :)
On the other hand ....
The Board only got refreshed last year BECAUSE of SeaFox’s actions in buying astake and calling a GM last year. The general consensus seems to be that the new Board have done a lot to turn GMS around. If SeaFox hadn’t agitated last year and the old board was still in place where would GMS be now?
Several large shareholders have been persuaded that cash now was more attractive than staying invested and have “jumped ship” - most of SeaFox’s stake building in the past few months has been achieved by buying out big stakes at both 10p and 22p.
The Board can no longer claim support from more than 50% of shares - Mazrui’s 12.65% was previously included in support of the Board as they had written a letter of support, but they voted against the Board at the AGM. Some of the large stakes SeaFox has purchased (such as the 22million at 22p) have probably come out of that support as well, although strangely the sellers have not filed TR-1 notifications as they should have for changes in major holdings.
SeaFox hold 29.99% of the shares and have requested Board representation of 2 directors out of 7 - that equates to 28.6% of the voting power of the Board to represent their views as 29.99% shareholders. That doesn’t seem unreasonable to me.
Far from not attending the AGM or not reading news releases I think you’ll find SeaFox are following events at GMS VERY closely! They have invested a lot already in building their stake and have been agitating for change for around 18 months now.
Since SeaFox were instrumental in causing the Board to be refreshed last year, and since the share price was languishing before SeaFox’s recent renewed interest, I for one think we have a lot to thank SeaFox for.
Thanks, Si547 for the link. I feel like Seafox is thinking that the SHs know nothing. I also feel like I need to clarify some points from Seafox’s letter:
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“This is after shareholders representing c.59% of GMS shares voted at the Annual General Meeting on 30 June voted”
When you act in concert with other heavyweight parties is hardly SHs sentiment. You should’ve said that you, Mazrui and Horizon didn’t agree with the resolutions.
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“We note that the price of 10 pence per share stated in our announcement of 5 May 2020, represented a premium of approximately 257% to the closing price of a GMS share on 24 April 2020”
Sounds good in paper and for those who invested at rock bottom prices. 7p and the subsequent increase to 10p for a company with 13 vessels (and I checked: 7 of them virtually brand new) was really a slap in SH’s face. Had you made a serious offer GMS potentially would’ve been yours.
I also believe that Seafox underestimated GMS heavily. They thought (like most of us) GMS would not be able to turn the ship around on time (pun intended). For this reason, they tried to get GMS as cheap as possible by taking advantage of external factors outside the company’s control. Luckily that didn’t work. That being said, you already bought 29.99% at a really cheap price. Can’t say you didn’t do a good job there and you should be happy about it.
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“We completely disagree with GMS's statement that our interests are not aligned with those of other GMS shareholders.”
Question is: can Seafox really afford GMS now and go hostile? (note: IMO 22p is not a fair price anymore). Or would they try to disrupt the company from within in order to influence the SP again, keep it low to the detriment of the rest of SH but to their own benefit? That’s another question your letter doesn’t address.
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“GMS's Board is in urgent need of further director appointments to provide the experience and know how required in order to address its recent poor performance and further deterioration of its financial position.”
Poor performance and deterioration of its financial position as of when? You clearly weren’t present in the last AGM or haven’t read any of the recent Trading Updates. I think this sentiment belongs to 2019 just like your proposal of 10p.
Looks to me that Seafox is trotting out the same justification for inclusion on the BoD; the same justification that previously failed.
When they say "GMS's Board is in urgent need of further director appointments to provide the experience and know how required in order to address its recent poor performance and further deterioration of its financial position", to me they appear to be referring to the earlier performance because currently, the Company appears to be doing very well, even during the difficult COVID pandemic.
https://www.prnewswire.co.uk/news-releases/statement-by-seafox-international-limited-seafox-we-and-us--870529989.html
driveat15 yes they do! Reality is that no one is against them buying the company; they just need to be prepared to offer a fair price (and that is different for each investor). If they had offered 30/35p I think they may have been successful. Now, with the banking sorted and nothing but positive news from the new Executive Chairman and BoD, I think they will have to pay significantly more.
I feel the whole drive to get their reps on the BoD is to keep the SP low via disruption/uncertainty etc, in order to facilitate their purchase of GMS at a knockdown price. Precisely why I shall be voting 'no' to their BoD proposals and hope the majority feel the same.
GM to vote on SeaFox’s proposed 2 nominees to the Board has been scheduled for 12 noon on 4th August.
Interesting snippet in the notice is that SeaFox now hold 105,111,287 shares which is 29.99% - the maximum they can hold without having to make a mandatory offer.
This means they have continued to add shares since the two big 22p purchases. They have added almost another 3m shares since then.
They do seem determined.
According to advfn the nav for gms is around the 92p mark.
30 would lead to an offer but surely it should be rejected.
I only hold a small amount here.
https://uk.advfn.com/p.php?pid=financials&symbol=L%5EGMS
I agree Si, good post!
"Seafox also notes that the resolutions proposed at the AGM to approve the GMS remuneration policy, remuneration report, deferred bonus plan, amendments to the LTIP, the chairman’s share award and shareholder authorities to allow share or other equity issues were also defeated by a majority vote of shareholders."
The same SH's that seem to be suspiciously aligned in their voting, so no surprise there and pretty meaningless really. I note that whilst Seafox are 'surprised' and 'disappointed' at this 'unprecedented' action, they in no way infer that such action is against the rules of 'the code', which I feel they most assuredly would if that were so. It is now incumbent upon those SH's that didn't vote, to ensure they mobilise when any subsequent vote is required, if they feel don't support a takeover by Seafox.
So far, I believe they would need to offer as a minimum, 22p if they were to get to the 75%(?) ownership required to force a sale. Indications are that current fair value is circa 32p.......
Don’t think the Board and SeaFox will ever be best buddies :)
HomeMediaPress releases
Statement re Gulf Marine Services PLC - Results of Annual General Meeting
02-07-2020
STATEMENT RE GULF MARINE SERVICES PLC - RESULTS OF ANNUAL GENERAL MEETING
PRESS RELEASE
FOR IMMEDIATE RELEASE
2 July 2020
Seafox International Limited
Statement re Gulf Marine Services PLC - Results of Annual General Meeting
Seafox International Limited (“Seafox”) notes the announcement by Gulf Marine Services plc (“GMS”) on 30 June 2020 in relation to its AGM held that day.
Seafox confirms that its interest in GMS shares (amounting to just under 30% of the GMS issued share capital) is held directly by Seafox or through a nominee account. Seafox does not hold any other interest in GMS shares, whether through the Swiss nominee accounts referred to in the GMS announcement or otherwise.
Seafox is surprised and disappointed at the GMS Board’s decision to immediately re-instate two of the board members which the majority of shareholders had resolved not to re-elect. Seafox believes such reinstatement is not only unprecedented but shows a disregard for the will of shareholders. Seafox also notes that the resolutions proposed at the AGM to approve the GMS remuneration policy, remuneration report, deferred bonus plan, amendments to the LTIP, the chairman’s share award and shareholder authorities to allow share or other equity issues were also defeated by a majority vote of shareholders.
Considering the fact that only 85% shareholders voted, and Seafox & Co was 48% or 49% of the company, not surprised with their majority and the outcome. Mazroui did vote against the 10p bid; perhaps there is a 22p or higher bid coming and they want to take it. The poison pill would have made it difficult for Seafox to win in a second round bid I guess. That is my understanding. Any other thoughts?
But yes, this is a distraction to management and board, if the above hypothesis is incorrect. But the stock is at 12p - risk/reward looks ok
They mentioned reporting the voting pattern to the relevant authorities. Does anyone know who this might be? Is there a rule or law against parties acting in concert in such a way?
So much for letters of intent. What a mess!
The voting was clearly suspicious; exempt Seafox, Mazrui,Horizon and the ‘unknown’ entity, there was was UNANIMOUS support from the remaining Shareholders (less 6 shares!). Having identified this activity and called for an investigation, will the EGM actually go ahead or will it be postponed until any investigation has been completed?
Timmy, SeaFox have requisitioned a General Meeting at which they call for all the GMS directors to be put up for election again along with two of their own people on the ballot paper.
GMS haven’t called that meeting yet, but have to call it by July 7th.
Now they can see the % support prepared to vote against the GMS directors I would suspect they will be a bit worried.
It sounds like GMS have a loophole, in the sense that if a board becomes too small to function properly they can reappoint board members... Sounds like its business as normal, so Seafox need a plan C now.
This is what happens when takeovers go hostile.......remember Seafox drew a line in the sand with their 22p purchase. They want two seats on the board so that when they make their next offer the board can't unanimously vote against it...IMO
Looks like seafox want to get GMS on the cheap and have cut deals with others to vote off the current directors in an attempt to get their “own” on board. Not great news and definitely an unnecessary distraction. Still, if things pick up Seafox may not get the support they need.