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Yesterday’s news has de risked this investment
Scooby - although investment trusts are within the scope of UK Corp tax, in general they do not pay Corp tax on capital gains if eligibility criteria are met.
As the company is focused on capital growth I believe they would have structured the company in such a way to be considered that Corp tax is not paid.
not sure you understand, even with tax the investments are currently valued at around a third at this mcap
Scooby - Large portion of the sale was already accounted for on the mcap, market knows best. might go up 10p (less/more) from here but overall if it was that cheap it wouldn't be (that cheap) especially when cash is involved. gl
So are we saying that the SP today should (theoretically) have risen 72p rather than 89p? And the "cash position of around £179m" quoted earlier has also not taken this into account?
"After todays deal 275p
you can buy for 165p
Gap must close but wtfdik"
That's what I thought initially, but, Arix got to pay the corp tax on the cap gain - so need to account for the 19% on portion of fair value gain not previously accounted for.
https://www.proactiveinvestors.co.uk/companies/news/219791/arix-bioscience-strategy-pays-off-big-time-as-merck-snaps-up-velosbio-219791.html
"
What the broker says
Jefferies added that the VelosBio sale is the first strategic acquisition from Arix's portfolio, in addition to NAV gains and the removal of all funding concerns.
The US broker added the deal highlights and validates the value of Arix's assets, particularly the less visible private ones, as well as the management’s capability to execute and therefore should boost investors' confidence and narrow the discount.
“The substantially strengthened expected cash position of around £179m also provides the group with extra flexibilities for new and existing investments; or potentially some distributions to shareholders."
"
Bull flag on the daily, can see this gapping up tomorrow
MMs were very reluctant to take this below 160p
yep can confirm, looks like they're done with what they were doing ... hopefully
Can sell a big chunk above bid
looks like a big buy order is being worked in the background, once done this will motor past 200p
look out for a big delayed trade after hours probably
looks like a slow burner, but we're probably about a £1 short on the SP - will get there eventually IMO, almost nil value on the investments
It is a lot of money and very welcome in times like these.
Watch out for monster delayed trades after market close
Mikey -
This is a massive amount of cash. Just wondering whether they have further investments lined up, otherwise a share but back (even a small one) would have a positive impact on share prise.
Hopefully a write up in investors chronicle, ii 23rd will get some new shareholders on board.
Totally agree
Lots of value to be had from current levels. Let the market do its thing. MMs want shares though. £104K sell trade live not touched the bid.
Just market mechanics IMO, value will out at some point.....cash position will be circa £180m after it goes through... then you're valuing circa £190m of investments at £40m at current mcap (£220m),
sg. Couldn't agree more on the credibility of the team. Hopefully this gets some good pr for the company, discount should be no more than 10%.
Wisha. Convinced me to hold on, was worked that this is now the second largest holding in my sipp and don't usually like too much concentration.
like the news. Up premarket there
should see an increase once US markets open
Instis may pile in.
One to hold for a few weeks to see value
Not a one trick pony
“Lastly, Arix points to a number of upcoming catalysts in the next 18 months, which should drive value, including clinical data from Autolus (17% of NAV), Imara (14% of NAV) and Harpoon (12% of NAV), with additional progress expected from Artios (8% of NAV), LogicBio (8% of NAV), Aura, (4% of NAV) and Atox Bio (3% of NAV) as of September.
Not only NAV, the Arix team's credibility must surely be boosted today.
Now if they can just pull off a couple more of these... :-)
As a longer term holder expected small incremental increases rather than this, incredible. I added to my holding earlier this year, the price was just too good to resist.
Question. As well as the nav increase - I would hope this would radically reduce the discount 1) it shows the portfolio is prudently valued 2) it shows the value within the portfolio.
Initially thought to sell down some of my holding, but will hold on.
After todays deal 275p
you can buy for 165p
Gap must close but wtfdik
That mad I couldn't spell madness properly
Isn't it nice to get a nice surprise like this, there's going to be many selling to benefit from the gains but a little look at the Market cap & the agreed sale says there's quite a way to go yet. Madness not to take another nibble absolute madnesd
It will be interesting to see what they do with this cash - I suspect we may see a special dividend for some of it (say 30%) with the rest being invested in other potential winning biotech companies