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it might also explain this huge number of micro trades to create illusion of turnover
because you don't pay 0.5% stamp duty on deals below £1K
chilting - shorts hold on hands only 10% of 7b shares
(most likely significantly less already, they're shorts after all)
with total valuation (considering current capitalization of £236m) of around £10m~£23m (max) on hands
Entry of any big player/buyer with even £5 mil in a pocket will
deplete remaining "free float" instantly with relevant reaction to sp.
sometimes I've impression what shorts just selling small lots to each other rotating it, along with MMs
On average (with SP dives in Apr, Aug and Sep) they're already in a good profit (theoretically)
but even if significant part of shares is already back - closing remaining shorts (say 30%) might be quite problematic.
Just guessing/scenario play (night flow), I don't really see/track much of what's going on on a backstage.
Yuri F
Yeah maybe...depends on your strategy. Some high risks bets are worth it, some are the only way to really make it if your principal & time horizon are limited. Diversification is for rich in my opinion, for those who want to preserve rather than multiply..
Gotta go, bed time
KOH
Yuri.F
The current market valuation is distorted by the shorts - until we get some positive news it is not to be taken literally.
I wouldn't argue with your dilution estimates but it could be the case that we will see a whole series of equity issues with some being more dilutive than others - hopefully not with the SP at these low levels.
KOH - that's what portfolios are for
always diversify and never have more than 25% (or even 20%) weight on single ticker
some positions go down, some up - there's no much control over it.
portfolio return matters, loses on single position (or even wipe out) causes much less stress.
(although I'm sometimes tend to break these rules)
Technically financial mechanics is a bit different, £0.5B bond sale will derisk project,
by the time conversion is offered SP will be significantly up (we're loosing less voting power)
Taking into account our situation whoever finances it - will push for more.
In the end IMO we are on a way down to a dilution between 0.2 and 0.5 (if we're lucky)
leading to SP range 23p-84p (depending on business case NPV scenario/dilution)
with expected value (because of dil. scenario probability) of around 36p (PV in 2019)
but for some reasons given current SP - market thinks there's
90%+ chance shareholders will end up with nothing
(or less than 10% survival chance)
As for SBR - it's clearly shelved/frozen now to save costs (survive over next 5mnths to avoid total stop).
Bellers mentioned it's gone/not visible, and holding part with cables/elevator would be fixed on a surface anyway
(I'm not an engineer obviously, just guessing logic - best of what we have in an absence of reliable updates)
so - IMO: SBR won't happen without finance, there can't be any "+depth" news about shaft
(unless someone agrees to wait for payment 5 years),
short story - RNS with sorting out finance (at least partially) is prerequisite for going deeper
(tunnel doesn't help at this point)
I’d take that. 25%...
___
I'd take holding for years just to break even (end of the rainbow for most of us now)....Can't wait for another kick in the face coming from our beloved leadership. A lesson learnt this year - whatever Sirius "indicates", expect substantially less / worse.
KOH
Any news on the shaft... one would expect a fanfare at launch similar to the PR when the SBR arrived....
Yuri.
I’d take that. 25%...
If it meant fully financed with first poly in 2021 and Torps in place.
Uncertainty is killing us.
btw - initial placement in 2005 was at around 6.5p,
that's already a very painful negative "return" down to 3.3p in 14 years for LTH (-4.7% pa)
We already do know gov's reply.
Qataris will only buy if we sell.
They don't care who owns it (despite their fraction in SXX)
Project won't go down the drain, dilution is eminent
(by how much - that's the only question at present, between 0.3 and zero)
historically minimum SP's were
2007 close to 2p
2008 below 1p
2010 close to 2p
2013 nearly 6p
in 2017 bonds were converted at 25p per share and in 2018 at 21p
Looking at present market £500M bond conversion would go for minimum of 3p (and everything above it will definitely mean denied invitation) leading to dilution of current SH down to at least 33% or perhaps even more because of negative historic experience. New "partner" would demand even more, even though SM equity stands at approx £700M - it doesn't seem we have much leverage for negotiating position.
Given environment of information deficiency - realistically I don't expect current voting rights to be more than 25% of total after (and it) SXX financial problems get sorted.
Since asking the government to guarantee the bonds, some things have changed for the better, there is now that big deal with the qataris and the government have to reply to the petition. All the government have to do is guarantee the bonds. Is it really worth letting a great project down the drain? Why would the qataris agree to such a deal if the company was set to go into administration? Why do some holders keep selling there shares? Its at least worth holding onto imo. Even if shares get diluted, in the long run there would be value for whoevers bought in at this low share price. Its got to be undervalued. Yet everyday the price goes down because of people like today panicking. Just hold onto your shares it is as simple as that or buy more. Dont let the shorters win!