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Hi cadburyhill. Thank you for the information about the Woodford Patient Capital Trust. Do you know what percentage of Arix's share capital it owned at the date of its previous Accounts? I mentioned in August that Woodford owned almost 20% of Arix, but I am not sure whether that was held just by the Equity Income Fund or by both Funds in total. If Patient Capital owned only say 5% there could still be a long way to go before Arix is completely free of Woodford.
Ok, so the WPCT RNS today confirms that it has completed the disposal of its Arix stake. I guess that still leaves the residual holding in the Equity Income Fund....At least there’s now only one moving part to the Woodford overhang story. It’s going to be a relief to all of us when that clears.....
Please note that the 50,000 transaction at 10.8p at 11.36 this morning is now shown as a sell, but the spread at that time was 106-109 so it was more likely to have been a buy.
Autolus's shares are now over $16, so they are rising quickly.
Has someone acquired Woodford's holding? Will there be an RNS on Monday or Tuesday morning?
Interesting that Autolus's share price increased from $9.80 to $11.93 yesterday, and someone bought 50,000 Arix shares this morning.
Is the tide starting to turn?
I listened to the conference call at 12.30pm and was impressed with the information given by the Chief Executive Officer Dr Joe Anderson and the Chief Finance Officer James Rawlingson, and their answers to the questions raised. I recommend shareholders to read the Interim Results Presentation document, the link to which can be found near the mention of the conference call in this morning's RNS.
None of us should put too much of our portfolio into Arix because it is essentially a long term project which may, or may not, produce good results, but the management seem to be very experienced and professional, and I would be increasing my holding now if the Woodford factor was not present. In answer to a question Dr Anderson said words to the effect that it was frustrating that the share price was relatively low, but the main cause for the decline was the existence of the Woodford shareholding (referred to only as "the W word"). Once that holding has been sold I expect the share price to rise, and I shall invest more as soon as the appropriate RNS has been issued.
Sorry - when I said on the 19th August that the value of Autolus's shares had reduced in value by just over two thirds I was comparing the 31.12.18 value with the value at the close of business on Friday 16th August. If I had used the 30.6.19 figures the calculation would have been $16.10 @ 1.2693 to £1 = £12.68, a reduction of 50.7% from the 31.12.18 figure of £25.74. Arix invested new money into Autolus in April, if I remember correctly, and I have not made any adjustment for that new money.
If Autolus's share price does not improve by 31.12.19 a further write down of Arix's investment will be required.
Arix's figures for the first half of 2019 have been published this morning.
I see that the value of its holding in Autolus represented half of its core portfolio at the end of 2018, so it is no wonder that the reduced price of Autolus's shares has caused a major write down. On August 19th I had anticipated a write down of just over two thirds, but Arix say that it is 41%.
The net asset value of Arix's shares is now 171p compared with 200p at 31.12.18, but this is still well above their market value of 109.5p.
As always we need to hope that one or more of its investments pays off. There is no mention of the detrimental effect that Woodford's substantial holding is causing. I shall listen to the conference call at 12.30pm.
I think that the downward drift is a combination of two factors.
Woodford owns 19.78% (about 27 million shares) in Arix. There was a sale of 100,000 a few days ago which resulted in the share price being reduced by a few pence. This may or may not have been Woodford, but it shows that if Woodford is forced to close down one or more of his funds he will find it extremely difficult to sell his Arix shares on the market - he will need to find a willing buyer, and who knows what the agreed price will be? As long as he holds a substantial stake in Arix the share price will be weak. He must notify the market if his holding is reduced below 19%, 18%, 17% etc, but each 1% is 1,355,518 shares!
The second factor is the value of Arix's investments in research companies. Autolus reported some figures a few days ago. In December 2018 its shares were quoted at $32.84 and the dollar rate was 1.2757, so the sterling equivalent was £25.74. Now it is only $9.91 at 1.215 = £8.15, so Arix's investment has reduced in value by just over two thirds. On the other hand Iterum's shares in the same period have increased from $5.01 to $6.76.
I am going to continue to be patient, but that is my personal decision. There is no guarantee that Arix's share price will ever start to climb again, and I accept that I might lose the whole of my investment.
Any clue what is going on to drive pricing down to 110p?? Woodford exit underway?
No. On 8th July his holding was down to 19.78%. He must let us know within two or three days of his holding becoming less than 19%. I suspect that he is chipping or hacking away at trying to offload a sizeable number of shares to an institution, and that the share price will remain weak until his holding is less than 5%.
None of this affects the potential for one or more of Arix's investments to develop a valuable drug. Let us hope that our patience will be rewarded. I am not going to average down until the Woodford situation has been resolved.
Any word on Woodford's exit from Arix? I saw he'd sold down a chunk but we could do with binning the wolf in the manger. So frustrating given the undoubted value on offer here...
ChippyHackee takes top IM decisions from his tree stump.
Hi - I am pleased to see that ChippyHackee has some company at last. In Beatrix Potter's tale that mischievous chipmunk had run away from his wife and was camping out in a tree! I hope that that was not the reason for the poster choosing that pseudonym.
I invested in Arix almost exactly a year ago at 178p following a write-up in the Mail on Sunday. I recognised that this is a long term investment and I have been happy with the increases in net asset value resulting from flotations in the USA. I was considering averaging recently but was put off when I discovered from an RNS that Woodford owned about a quarter of the company, and I am now going to wait until he has managed to sell the vast majority of that holding.
It is interesting to see that the share price went up mid-morning and that this was followed by two "sales" - perhaps they were actually two cheap purchases. Anyway it is good to see some action and some chat.
Agreed. You won’t go far wrong at 130p. Just waiting for the Woodford RNS...feels like it’s close. There are decent sized tickets going through most days at the moment..... I then expect a reflexive move back up to 170p+....
Hi all. I have been watching Arix since May and think 130p is a good entry price so have made my first purchase in my SIPP.
Their investment portfolio looks promising, cash position is strong and broker sentiment is positive. One to hold and watch...
https://www.proactiveinvestors.com/companies/news/219791/arix-biosciences---venture-capital-firm-flies-under-the-market-s-radar-219791.html
Yes Skid, look that way to me. Their results were excellent and reading between the lines any Board squabbles have been resolved with the new hire from JP Morgan. The problem for small investors is that the trading volumes are so tiny that they aren't moving the dial yet the institutions are not active. I've been adding to my holdings, up to £20k in my SIPP now.
Good to see someone posting. I have a c £5k holding in my SIPP as part of the small adventurous part (Mercia, Draper etc) and I am thinking of adding to it. Just think this is completely under the radar ?
Looking forward to the results presentation later this week...should hopefully give confirmation that this is a decent buying opportunity as the discount to NAV is now substantial...
any idea??
Tiny deals here. Good news from last few RNS, but no upward movement. Can we take comfort that there has been no fall, given US falls??
...and another :
http://www.proactiveinvestors.co.uk/companies/stocktube/10188/artios-in-strong-position-to-accelerate-cancer-programmes-after-arix-investment-10188.html
This one with Jonathan Tobin plus Niall Martin (chief executive of Artios Pharma).
"Jonathan Tobin, investment director at Arix Bioscience Plc (LON:ARIX), discusses with Proactive's Andrew Scott their decision to increase their stake and in doing so becoming the largest shareholder in Artios Pharma."
http://www.proactiveinvestors.co.uk/companies/stocktube/10165/arix-sees-significant-potential-as-it-ups-stake-in-cancer-treatment-developer-artios-10165.html
We go down and syncona are substantially up. Why the disparity??
We seem to be treading water, or slightly sinking post rights issue. any views?
Thanks for that. I did think it was probably aimed at bigger fish than me.
you don't have to participate but for the big strategic investors this is a necessary step. the higher price reflects some estimate of the uplift in the net asset value of the business as it has progressed since IPO and it allows those investors who invested in the IPO round to partially offset the dilutive impact of more shares being issued. for those strategic investors coming in at this round, like Ipsen, they're just not that price sensitive. they're playing a very long game and what they 'lose' by slightly 'overpaying' for Arix stock in open market terms, they gain via their strategic relationship with Arix. Besides, they will have done the work on the portfolio and will think it's worth at least 225p Arix have to offer you and me the chance to participate, and that is what they've done. I suspect they'll be disappointed that the share price isn't higher on the back of the autolus application to file for a US IPO - which is a big deal. US plays like Autolus have market caps in the many billions and represent a major uplift for Arix (and the chance to sell-down). It has felt to me that there has been a background seller dogging this stock almost from IPO but maybe it's just that we've been in a bear market for UK and pharma stocks for a while now.