The next focusIR Investor Webinar takes places on 14th May with guest speakers from Blue Whale Growth Fund, Taseko Mines, Kavango Resources and CQS Natural Resources fund. Please register here.
London South East prides itself on its community spirit, and in order to keep the chat section problem free, we ask all members to follow these simple rules. In these rules, we refer to ourselves as "we", "us", "our". The user of the website is referred to as "you" and "your".
By posting on our share chat boards you are agreeing to the following:
The IP address of all posts is recorded to aid in enforcing these conditions. As a user you agree to any information you have entered being stored in a database. You agree that we have the right to remove, edit, move or close any topic or board at any time should we see fit. You agree that we have the right to remove any post without notice. You agree that we have the right to suspend your account without notice.
Please note some users may not behave properly and may post content that is misleading, untrue or offensive.
It is not possible for us to fully monitor all content all of the time but where we have actually received notice of any content that is potentially misleading, untrue, offensive, unlawful, infringes third party rights or is potentially in breach of these terms and conditions, then we will review such content, decide whether to remove it from this website and act accordingly.
Premium Members are members that have a premium subscription with London South East. You can subscribe here.
London South East does not endorse such members, and posts should not be construed as advice and represent the opinions of the authors, not those of London South East Ltd, or its affiliates.
I don't know where this is heading. Another 15% buyback so more control to the family. They had majority control anyway so why. A buyback when things are low can be good but I'm not convinced here. Not about the numbers but about the control side. I thought it might be to remove it from the market. There was also the threat of loosing REIT status. So I left and even after the jump in SP it's still way off.
Hopefully I'm wrong as it was the family control that was an attraction when I first bought in. I knew they would look after themselves so I could follow on their coat tails. It went well for a long time but something changed.
Whilst they are suffering from the general things that effect REITs, rate rises, debt, ltvs too much retail, companies going bust etc. Why give it the potential to loose that status or the loss of availability on the market.
I didn't want to be left holding the baby with no home to go too. Like I said, I hope my fears are wrong and that remaining shareholders will be OK on those tails but it's a risk too much for me.
Good luck all. Shall miss the divi in January thought even if it was low yielding compared to some.
I think you could be waiting quite a while for it to get back to £2.50.
I bought some earlier this month though for £1.25. I think there's quite a lot of bad news baked into the price at this level (I may well be wrong though; I frequently am!)
Let's see what the full year results say in October - good luck
I am invested into this.
Looking for some thoughts from others.
The NAV is significantly higher than the price of the share. I am not sure what is going on with this.
Will this come good some day?
My AVG is around £2.50
Im still not sure what's going on with TOWN.
Sale of Whitehall Riverside, Leeds above book value. Reduced debt by £10m and bought the rest of Belgravia Living Group for £3.5M but this has debt of £14.5m of which TOWN only had half but now all so an extra £7.5m.
So it looks like they have traded a pipeline asset for more income that appears to be doing well.
No holdings but following out of interest and that I liked the story
Well I think I have been scared out of my holding. Loosing REIT status and a potential buy out on the cheap doesn't look great for PIs
So it's taken a bit longer that initially planned but I'm all out. Pity as I liked the story and the family holding to begin with.
We've had some ups and downs along the way and really I wanted to increase my holding not sell. Still now I'm out the SP will rise
Town seem to have given up on he buyback. It does seem odd that on the one hand the latest proceeds from sale of £12m are being used to reduce debt, yet on the other hand share buybacks increase debt,
Yes its a bit of a worry the way this is progressing. Unsure what to do now here.
Still it is what the management want but what is the long term goal
As Town is almost certain to lose its REIT status as a result of this buyback, it is clear that the controlling Ziff family will not be participating. Thus less than 35% of the shares will be in public hands, and with a market cap of £80m approx, their holdings are worth approx £28m. The Ziffs could probably gain full control by paying £35m or so to the public shareholders.
The maths get even better if all the 7m shares subject to the buyback are offered up. But IMHO this is unlikely.
Im sure there are associated costs with paying down early as with most types of debt. I wonder what the final debt profile they are looking at. That 5%+ debenture might start to look "cheap" they way things are going. I thought they might do a placing to reduce debt but I doubt it at such a discount and borrowing is hampered slightly by family holdings.
Still I suppose those family holdings should keep things pointing in the right general direction. The Edision report flagged falling property prices a worry on banking covenants, which is slowly being addressed. Im not sure there were forecasting a rise in the dividend though until 2023.
This is still a recovery play for me for the next year. Hopefully when its right sized they can work out how to progress the pipeline.
At the moment , doing ' a deal ' on the debt with holders would mean a price of around 110 as I believe there is a ' Spens' clause affecting early repayment. Maybe buying equity at a discount to NAV is a route still preferred by the board.
It sounds like management agree with you regarding debt. I note the steps they are taking to reduce it. I don't fully understand the reasoning behind the tender but ambivalent about the buyback. I can only assume that a buyback was taking too long.
The US taxes dividends higher so probably why more buybacks are done. I haven't come across a tax on buybacks but hopefully Google will be my friend.
Still constrained by too much debt IMHO. To me the share buyback and tender offer were mistakes as equity is the shock absorber when the economy in general is going south, such as now. Of course buybacks are depressingly widespread throughout listed companies. I note that in the US, buybacks are subject to a 1% tax now. We shoiud do something similar but higher.
Divi bump has arrived but .......
"These disposals, partially offset by the property acquired during the year and the further post year end purchase will lead to a longer period of reduced earnings which will inevitably lead to a lower level of dividend payment than in recent years."
Well you cant have your cake and eat it. As expected, selling properties reduces income. Debt is reducing and I suppose they have one eye on the future as it will be getting more expensive as it reverts to more historic norms.
Oversubscribed, yes, but not by much. Perhaps suggesting that most shareholders are happy to be in for the long haul.
The final para of the RNS left open the possibility of the Ziffs increasing their own shareholding.
So it was over subscribed. I'm a bit shocked to be honest. The metrics on the remaining shares should look better now and the SP has been pushed up not great if like me you were looking to aquire more.
I suspect that trading will be reduced even more. I can believe that there were so many low numbers share trades. Just need a divi bump now.
My gut tells me not to accept. Perhaps MMS are maintaining SP below the tender price so as not to undermine the tender, but who knows. And in the long run the Ziff family must be talking at their dinner table about going private sometime.
The key is held by the Debenture holders at present, but a deal will have to be done with them sooner rather than later as the redemption date is drawing ever closer.
Personally I'm in the accumulative phase so dont want to sell but rather buy more. I haven't identified another home for the money either. I suppose it depends on if you need the money, what your avg buy price is and thoughts about the future. Will the SP re-fall will the dividend grow faster!!!!
Personally it would be in my interests if you sold or at least some others do as it makes the remaining company metrics much better.
Any thoughts on whether to accept the offer?
If so, this could be construed as trying to buy out the minority shareholder on the cheap.
Well its at a premium to the historic share price so not on the cheap. I suspect the Ziffs and not taking part as it might be deemed as profiteering. The will own even more of the company in percentage terms though.
You dont have to sell
From memory they paid off £3.4m of that debt but it cost a bit more to do so.
I also note that the Ziffs are not taking part in the tender so maybe that was what you were getting at in the previous post.
I can't recall your £18m figures was that from the half year update.
The trading update and shareholder circular are rather light on the debt situation, in particular to the £100m Debenture Stock. At the half year £18m of disposal cash was being held against that debt. Sure the properties were secured, so why not put forward substitutes. Perhaps because the Trustees of the Debenture Stock have no faith in the formal valuations. If that is so why not just pay off the £18m. Negative pledges?
Hi schwee, I think you have it wrong. The Ziffs can match sell and still retain their majority holdings.
So they sell 3.8% of theirs and we remaining shareholders sell ours matching the same 3.8% in total.
Having only a quick read it seems you are guaranteed to be able to sell 7.61% of your total holdings if the tender is agreed but maybe able to sell more if others dont sell. Which may or may not include the Ziffs.
Have to be quick though buy at 175 and almost guarantee 185 sell. Might look if I have any free trades left
Am i correct in reading that the offer is for 14% of the outstanding shares rather than the published 7%. This because the Ziffs own 50% and are not going to tender any of those.
If so, this could be construed as trying to buy out the minority shareholder on the cheap.
Announced now that the app is actually sold. Alongside other sales it will give them even more cash. Debt will be reduced and the pipeline to be invested in.
The update seems positive too and the SP has reacted positively. Hopefully this will see dividends follow the upward trend in time. Im not sure that they will increase the time scale to increase dividends earlier even with the app sale.
I'd not seen the stories in the on this although to be fair, I'd not been following the markets as closely as I normally do.
Yes a big jump on the booked price and its looking like a good investment. Just wish the shares here followed the same lines. Still it's off its recent lows but still offers a big discount.
Market cap £75m so £20m in cash might be handy. Might get some of that pipeline moving