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"And the share are down 4.8% today on their results, does this make you even more bullish, as "mercia are cheap today, cheaper than yesterday" ?"
Being down one day by 4.8% doesn't validate what you've said nor does it negate what nikkib wrote. The value of the MERC assets will be realised in roi both privately and hopefully publicly for us.
The sale of NAC was and still is a terrific result, MERC realised an asset which gave them multiple returns.
The results this year also reflect the rest of the MERC portfolio - and as per normal the MERC results will fluctuate accordingly. Depending on the investment companies you will certainly find some issues in some assets and as such firms will cut their losses and move on. This isn't something new or out of character. The AIM stock market reacts as it wills and should have re-rated had it not been for the losses due to the coronavirus. Many companies have had issues. The company didn't do well because of the coronavirus... not it's a bad company.
It's important to understand what people think of the company by it's own industry standards. They are a highly respected group of investors, to the extent that they are often asked to join in as a co-investor on new rounds. What you see in the portfolio as "lemons" are also "lemons" for other companies.
As for my silence I have a day job and also many other investments both private and public - apologies if there was a delay, I didn't expect this as a time sensitive priority.
Coming back to the MERC structure, a bad financial result due to the coronavirus that does not change the company structure. MERC have both direct and indirect investments (3rd party). They run pretty much standard based on third party investments i.e. MERC invests other peoples money, under a fund name, and when they get a return at the end of x number of years a proportion of that is returned back to the investors the remainder is kept by MERC. However when they make direct investments, unlike other firms, they keep all of the return on investment.
Why I'm bullish, because I've seen the investments they've made, some exceptional, some okay, others not okay - but on the whole pretty good. Secondly, the investment team are professional and heavily audited, they have a very good grasp of what they are doing. Their assets are maturing well and it's a matter of time before they return big on some of the investments - meaning a great return for us. Also the coronavirus has dampened the positives, but the portfolio companies are still fairing well - once coronavirus impact subsides we should see some positive gains.
"Are you assuming that the market just don't understand Mercia"
Yes in part I am, the reason being that someone like yourself who has been invested for a while didn't (or still doesn't) understand their investment structure. If you can't grasp this, and keep reiterating nonsense, then how do expect others to understand what is going on? The information you seek is available online on their website and at worst a phone call away. You are in effect deramping your own investment. The unfounded "groovy gang" comments, suggestion of ill gotten gains, and other such nonsense is grating. How you've associated this years results with your nonsense is also ridiculous.
@john ht
After pronouncing the rumours as a "terrific result" you have yet to make a comment on the results !
Are you assuming that the market just don't understand Mercia, your silence after your overt bullishness is odd, history tells us that the market rarely gets things too far wrong.
@nikkib
And the share are down 4.8% today on their results, does this make you even more bullish, as "mercia are cheap today, cheaper than yesterday" ?
I am fascinated to know, please enlighten us.
Or do you now realise that the market were right in NOT reacting to your news re Sona/native antigen ?
@johnht
So what do you think of the figures today ?
You say "most people don't understand" re Merc, but perhaps more people understand than you think ?
For every decent covid stock (which are nascent) there are plenty of other lemons hence the 15% mark down in valuations re covid !
The matket normally knows more than individuals
Nikkib - well that pretty much confirms what I said regarding the company structure and holdings. Unlike other asset managers in their field, MERC invests both directly and through their third-party. Had this been any other fund manager, they would have received just the carry from the third-party. However, MERC receives the return of what's directly invested and a further third-party kickback.
Overall a terrific result as we still have the other COVID stock in play.
"In addition to the direct investment returns, the sale will generate a 12.1x return on a blended third-party managed funds investment cost and a 31% funds IRR."
Some really great points there Nikkib.
I am a little surprised at the lack of share price movement in Mercia, but this is partly due to their structure. Most people don't understand, but MERC invest their own money along with the traditional asset management. Which in my opinion makes them superior. MERC are at an ~£80M market cap, highly undervalued considering their COVID stocks have boomed - when the next results are out for them without doubt there will be a re-rating.
There is also another great stock in terms of AVACTA, their PoC product will be completed very soon. Combine that with MERC's own investments in COVID PoC diagnostics, I'm hoping to be covered whichever way the cookie crumbles.
Johnht – here’s the page from Sona’s website showing that they will be sourcing the reagents for their Covid-19 test from The Native Antigen Company.
https://sonanano.com/partners/
The Native Antigen Company is 30% owned by Mercia and has teamed up with Oxgene (also 30% owned by Mercia) to scale up production of reagents for Sona and others.
https://thenativeantigencompany.com/about-us/events/
Also worth noting that The Native Antigen Company are supplying reagents to BBI Solutions who are part of the UK Rapid Test Consortium that has just announced a design freeze on their home antibody test. The lead partner in this consortium is Abingdon Health (a Mercia investment fund company) who have scaled up production by taking over a production site from Concepta (another Mercia investee company). BBI are supplying the reagents for the consortium so these are presumably from The Native Antigen company.
Sona opened 85% higher today and I’m a little surprised that their news has had absolutely no impact on Mercia’s price.
Nikkib sounds interesting. Do you have further information on Sona Partners & Mercia?
Sona Nanotech have won the race for the first POC antigen test (beating Avacta). Their shares were suspended, pre-announcement, and should rocket tomorrow.
Despite the scepticism voiced by some on this site, I still believe that it will have a positive impact on #MERC who own 30% of Sona partner, The Native Antigen Company, who will be supplying the reagents to Sona and, in anticipation, have scaled up production of reagents with another 30% #MERC owned company Oxgene.
https://www.newsfilecorp.com/release/59059