Seplat Energy's CEO Roger Brown hosts London Capital Markets Day and focuses the strategy. Watch the full video here.
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That’s great SHS that you are not interested in how the company is run. But the whole point of this BB is to air these discussions.
Your statement is at odds with the number of posts you are making defending the company.
I am sure having a PLC that you can do transactions with without having to declare it to the market has its advantages.
I have no desire to micro manage Scir investments for the BOD to provide answers on any decisions they make on behalf of the business.
If its important enough to require a shareholder vote. Then I can vote. I'll leave them to run the company.
You may recall me saying that I have done all my stressing on this company a long time ago. I am at peace with my investment :)
Do you prefer incredulous?
SHS - “ Why would Scir give EAG half the money so they can buy half of Greenan”
Shareholders are flying blind here.
I’m actually surprised that SCIR do not have to disclose the details via RNS?
Good luck to you deciding how to vote!
And being as EAG business & financial transactions do not need to be released to the market, we have no idea what deals (if any) they have done with Greenan, its directors or any other company.
Unless T.R becoming a director of EAG chooses to release this info, we will never know.
EAG maybe private (i.e. not listed) but it is still a limited company, so has to post accounts.
The Greenan plant 'commenced operations in Jan 2016' and 'Plant construction was funded by existing debt provider'. As EAG was only incorporated in Oct 2019, so it cannot be the existing debt holder.
I already voted :) I don't ever recall expressing shock. I'll leave all the stressing about whose getting a good deal to you lol.
Shs - it’s hugely important that shareholders understand the deal - I believe you will get a vote on it?
SCIR have done exactly what you are shocked about. They have supplied all the money, EAG have provided the introduction to Greenan. Great deal for them!
The big question is how much of SCIRs money is a loan and how much is for equity.
One thing is for sure and that is that with all of the debt it will be a long time before shareholders see any free cash flow!
As I’ve said, this deal only makes sense of EAG is an effective way to quickly buy lots of small biogas assets and have a team that can optimise them. Maybe the EAG guys have the contacts and knowledge to make that happen.
Funny thing is, we nor the market will ever know because EAG is private lol so it really doesn't matter who owned what or who paid for what with what money.
I may very well be wrong. But it still makes the most sense to me. I don't understand why Scir would buy and own 100% of Greenan if that wasn't the case. Why would Scir give EAG half the money so they can buy half of Greenan. Unless EAG already had an equity stake &/or own equity stakes in other businesses in the pipeline & so that's where their value as a JV partner comes in.
26 chats and 7 trades and most about by far the smallest asset in the companies portfolio.
Ruvuma + HE1 is the focus for now, the EAG deal looks ok to me and generates a small income with potential to expand.
Another good day @ HE1 today + 9.27% on top of yesterdays rise & David Minchin on a plane to Tanzania right now to see how the other 90% of the drill is going post initial shows, trap and seal.
SHS - you are wrong.
EAG existing directors have not put any money in. The transaction is being funded by SCIR - some of the funds are a loan to EAG, some as equity purchase (and for that they are getting half of EAGs shares).
EAG are also taking on £1.9 million debt owed to a third party.
I think that's exactly how the deal is structured; hence the "shareholder loan".
EAG may have a provided funds to Greenan through a convertible, and now own a percentage. The could have leveraged that in this deal as a buyout.
The details doesn't say how much EAG have paid for their 50%. So I am assuming they already owned 50% or close to that percentage.
I do see any details on EAG paying anything. So it's the only thing that makes sense to me.
SHs - I don’t think the debt is owed to EAG. They (50% SCIR, 50% the 2 existing owners of EAG) are taking on the debt so it must be owed to someone else. We can’t make a loan to our own company!!
It would be interested to know who the 3rd party is, and when / why the debt was taken on? Has it been loaded up with debt as a way for the directors to funnel cash out of SCIR? Is it a related party to the existing EAG directors?
You do have to ask questions when a company takes on a lot of debt prior to being bought. Or has there been a major issue that could cause us operational problems? Seems strange to load up on debt after operating without any for a number of years?
AIMVHO of course!!
Its my understanding that because EAG is a private company, any financial details aren't public information. And so there wouldn't be any details available.
Yea I'm sticking with my assumption that EAG already owned a stake in Greenan through debt. And this deal is structured so EAG gets some return. Either way, it doesn't really matter to me who gets/got paid. All I am concerning myself with is how much income will be generated month on month.
I stand corrected. SCIR is funding EAG by equity purchase (quantum unknown?) and shareholder loan (slide 7 does state this to be the bulk). I would agree it could be clearer.
No accounts for this year yet at greenan - they must have loaded up the company with debt in the last year prior to sale. I wonder who the lender is???
EAG do not seem to have any assets
Neither company has filed full P&L
MRC - I'll have another look when I'm on the PC rather than my phone, as I see there is mention of shares as well as the loan.
SHS - Limited companies have to file accounts with Companies House, so their financials are in the public domain. Although some use a 'small company' exemption to only file a balance sheet and no P&L. I'm sure there will be someone on here who is better qualified than me to explain.
HM I am no rocket scientist but I like to think I have a basic understanding of a lot of things. To me; the structure of the deal isn't clear. Its cool you understand & have tried to explain it, but I think you are the only one who does understand it.
I don't really concern myself with the day to day running of Scir or who's back gets scratched. I just want to understand the financials. And at the moment; even though they are there in Black & White, I am still confused.
Its my understanding that EAG is a private company and so their financials aren't & won't be available to the market. And that is where I think my confusion is rooted.
Would you agree that its really not clear?
The slides say we are subscribing to shares and also providing a loan. The waterfall just shows 1.2 million going to EAG.
We also don’t know the terms of the call option.
Were these questions asked in the audio cast?
Are we going to get a proper RNS announcement detailing the terms of the deal? We need fewer busy slides and more just black and white data from the BOD IMHO.
We appear to have differing interpretations of slide 8?
Highland - the £700k is NOT a loan
It is paying for 50% of EAG which has zero assets. Effectively we are buying greenan then giving away 50% to these 3 guys who actually know anything about biogas (or claim they do). You have to admit it is a little murky!
The 300k being used to clear part of the debt may or may not be a loan.
Greenan have liabilities of £2.8 million which we are taking on
SHS - I'm afraid I'm not getting the issue. What is it about the deal which is not transparent? I thought the slide pack explained, and the balance sheet for Greenan is in the public domain. Of course, I could be missing something, but it seems quite straightforward (and dare I say, clever?). SCIR is forming a 50/50 JV with EAG. SCIR lends money to EAG, which buys Greenan. EAG pays SCIR 10% on the loan. If Greenan turns a profit, dividends can be paid to EAG. If EAG turns a profit, SCIR can get dividends.
I am now guessing EAG being a private company has a lot to do with the non transparent deal.
Also that EAG must of already owned a stake in Greenan; probably through convertible debt. Which is why the transaction & structure is confusing.
Does this make sense to anyone?