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Me Too!
BBSN is in good shape. No need to pursue a deal that bets the farm.
They are better off making organic customer wins and account development their core endeavour, and looking for bolt-on businesses in the £5m to £10m revenue space, where the existing client relationship holders are often also the owners, and who want to come for the ride with BBSN. No two deals are the same, but developing an acquisition model whereby the acquired owners receive consideration in a mix of Cash / BBSN shares and performance related deferred consideration should lead to a twin track growth strategy that can be financed within current resources and those that the bulked up business delivers.
I know that you can argue that everything is a function of price, however I would rather BSN grow their capability and customer base through cooperative acquisitions, where the buyer and seller are united in the working together towards the common goal.
FG
I’m happy BB have walked away, although a small cap this shows maturity in management - now the accounts at BB will become even more healthy as clients gradually flow into the more attractive, lean and progressive business.
Just looking at the share price since launch,
Goodwill 2022 circa £5m. 2023 circa £10m.
Always an interesting way to improve the balance sheet.
Why would you think you can buy TMG for half the price in six months. TMG business is robust enough to get out of its debt issues, the business is sound and in a different league to this opportunist outfit. He ho. We all have different views, which makes life more interesting so long as it does not lead to WAR! The human race needs to find world peace.
Anyway good luck here with your investment. Us PI’s need some luck to beat the greedy b******* that run PLC companies.
Walk away and buy it in 6 months for half the price, BB seem better margin wise and that will be diluted if we proceed with the buy, that said the buy does open a lot of doors to customers
Definitely agree Bazzaman.
It feels like a hornets nest.
A cheaper and more effective strategy might be for BBSN to recruit a couple of capable Account Directors, and go on the offensive to win some new business.
I wonder where I might start drawing up my list of customer prospects??
FG
Https://www.investegate.co.uk/announcement/rns/brave-bison-group--bbsn/response-to-revised-possible-offer-announcement-/8246241
Time to walk away I would suggest rather than up the offer.
GLA
Imo BBSN should have walked away and instead stayed nimble growing the company organically. Mission has a decent topline which I'm sure is what's ultimately attracted the bid, but with that comes a pretty horrific balance sheet - in contrast to BBSN's with its positive NAV and minimal borrowing.
My own opinion is that the offer should not have been upped...and those that are able can crunch the numbers JM but ultimately the deal or not will not be our decision as the only vote that will count for us is to vote with our feet and leave, or we can stay with the company and see what transpires...
I don't disagree with what you are saying FG / Nimrod. Obviously it will be a few years until anyone can pass judgement on whether an acquisition was successfully integrated and a wise investment. But, that is the same for any acquisition for any other company. What we can assess right here and now is whether the price paid is a good deal for BBSN shareholders based on both companies current performance metrics. Does anyone have an opinion? I'll be honest and say I haven't yet done the math's but will do so and feedback my thoughts shortly. This is not an acquisition that BBSN can afford to go wrong if they go through with it.
Agree with Nimrod....
It will be 3 years down the line before one can look back and say that any particular acquisition was a good deal or a Pup.
Obviously finance / price / currency all play a part in that assessment, however it largely depends on how well the present management expand their team, and up their game to drive a business that is 5 times the size of their current operation.
I am all for the "More Grist to the Mill" line of argument, but that only holds for so long, until you reach the point of having to build a new Mill!.
There is also a big question as to what will happen to the Mission Operational Management, as it is they who hold the customer relationships at present. Will the Mission Management be retained, or do they go in the first few months after completion.
As relatively small shareholders it is not our place to want to see the operational plans for integrating such an acquisition, and so to a large extent it is not a question of which group of shareholders is getting the better deal, but more a question of do you back the Green Brothers, and the CFO to ensure that they get this big fish onto the bank, and then know what to do with it once its landed.
I am also conscious of the fact that Lord Ashcroft has built a stake of c23% of the shares in this company, and to that extent I suspect that it might be him that is driving the agenda.... in which case one should do some research as to his track record in successfully integrating (or not), acquisitions in his other interests.
One doesn't know all of the facts, but to me, finances aside, this is no bolt-on. I just hope that our corporate eyes are not bigger than our tummy!.
(Six metaphors in one post!!)
Fishing Gardener
Yes, I think we can look at the offer and say whether we think BBSN or Mission shareholders are getting the better deal from this increased offer based on current company performance. Why not?
Well, will anyone really know if it is a good deal or not until after it is actually done? I definitely don't...
Well for starters they have upped the offer price fairly considerably, approx. 20% more so plenty to discuss if you think it is a good deal for BBSN or not? The market doesn't think this will happen eitherway as neither share has had any reaction whatsoever which is a little strange.
What's to be said...wait and see is all...
It was a late rns so most will have missed it. Expect some feedback tomorrow.
Why is nobody commenting on the revisied offer to the mission?
2½p is not a share price with any gravitas. It's a penny stock punters' share price. So I expect we will see a share consoludation at some point. And perhaps leave TMG to drown in its debt; there may be opportnities later.
Feels like an earn out for someone, a way of realising value for the owners..... less so the small shareholders ....
I am obviously for increasing shareholder value and would prefer buybacks to a dividend to achieve that, however, it won't do it in the short term....and I am confused as to why now in the middle of a possible takeover bid with an all share offer...we are reducing shares and possibly increasing them with the bid...any chance of some clarification anyone?
Looks like Lord Ashcroft has further upped his stake to 23.7%!
Good post FG. Agree with what you are saying. The offer does feel opportunistic and clearly hasn’t gone down well. Much prefer a friendly takeover where management stay on and keep their clients on board. How many clients would stay if their key contacts left? Not a lot I suspect unless there was a lengthy handover and the takeover went smoothly. We also have to consider the debt that would be taken on which is large and would take some time to pay down even in the event that brave bison turned mission around. I won’t be particularly sad to see this one fall through and hope the board don’t get into a petty war.
Theo and Oliver Green have a history of building up a company and then selling it on which was one of the reasons for my investing here so they are obviously very clever business people so I hold my position...
Some serious and thoughtful thinking there FG...'smash and grab' Yes...'Cheeky' Yes...'Gung-ho' Yes...my first thoughts were NO! and don't raise the offer for goodness sake...