Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
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Yeah spread looking very good
I would be happier when Frazers get to 30%, assuming that is their aim.
The sell price is increasing I was just offered 40.96 at a volume of 40k.
And again, was almost willing to take a hit on this a month or so ago, so compared to where it was, had to drop some exposure. Still holding some though in case of any jump. Will re-buy if any fall.
Average was just a little over 36p and sold some today at 40.4985.
I agree with the longer term outlook and with the potential buying still to come from Family and Mike.
However, i think the overall market is extend this year. While holding brown i thought the returns were idiosyncratic due to the takeover news. However, boo and asos are up HUGE this year too. Plus some US stocks are up 100% now from the lows. Market is pricing in lower inflation and pauses/cuts to rates. Central banks are saying more is to come. Macro outlook is the same, ie war getting worse, china up to their old tricks.
So all in all, wanted to drop some risk as AdamAnt said.
Yes, the trend is your friend – until it isn’t the trend anymore. I am a strong holder and fully subscribe to the long-term case well made by Brighty. The only snag is that, the better the case for BWNG’s long term prospects, the more difficult it is to fathom Schroders’ decision to sell at a bargain basement price. Maybe more information will emerge in the coming days; and perhaps Andy Brough will explain. Anyway, I sold 14% of my holding at 40.20p – for risk management purposes. I would buy back into weakness and probably sell another tranche into strength. I'm about 2p away from breaking even, which - compared with less than a month ago - is a nice feeling!
Yes, the trend is your friend.
There is actually Hardly any selling. 335k bought v 39k sold. Whilst not completely accurate its a decent guide. Ive not checked but its probably overbought.
Might be some pi,s sells later this afternoon as is common to fridays but big buyers are hoovering them and some.
Im Happy to ride the trend up whilst that is in play.
Still some PIs going for a quick profit in the high 30s and low 40s, but if Frasers are also accumulating as they appear to be there could be more to come here.
So we now know that one of the big buys on 1st Feb was Lady Alliance at 291.75k. There's an interesting TR1 coming next relating to the £440,000 buy yesterday at 40p. Alliance or Frasers? Good luck, Brighty
Yeah saw all those, got to have another rns then!
These 2 large trades for 750,000 and 500,000 have also just appeared today as well (from yesterday)...
01-Feb-23 16:43:07 38.90 750,000 Unknown* 39.60 40.00 291.75k
01-Feb-23 16:00:38 38.425 500,000 Unknown* 39.60 40.00 192.13k
TR1 inbound from either Alliance or Frasers....?
Good luck, Brighty
Another large buy of £440,000 at 40p from 10.57am just published:
02-Feb-23 10:57:42 40.00 1,100,000 Unknown* 39.75 40.55 440.00k
Good luck, Brighty
Sold the 20/21/June top up back for *40p
Odd number of shares when added maybe both buys were partials in June with the 21st a near complete order .
Large buys going through at 40p have gobbled up the sellers who had a 40p target.
Stock still in demand.
539,009 volume in auction. 2,037,503 total today. 39p finish.
RNS coming again?
Edben, I'm with you on this longer term strategy. In summary:
* The restoration of dividend payments by BWNG, now that the Allianz Insurance court case has been resolved and the business has been transformed from the Angela Spindler era to the Steve Johnson era over the past 3 years, could also be the rationale behind a defensive ploy to keep the business from a predator.
* Keeping it listed on AIM for IHT reasons rather than bidding for it makes perfect sense.
* Pre to suspending the divi in 2020 due to the uncertainties surrounding the Covid pandemic BWNG in the previous 3 years 2017 – 2020 had paid final dividends of 14.23p, 14.23p and 7.1p.
* The reintroduction of a meaningful dividend at BWNG would enhance the share price and with such a large holding would be significant to the Alliance family (and shareholders in general).
* A share price in the hundreds would be the time to sell BWNG not sub 100p.
* We know that Asda was rumoured to be considering tabling a bid of 360p a share valuing the business at 1 billion a few years ago, x 10 where we are today.
* By keeping an iron like grip on the business probably gives the Alliance Family the best option to eventually make the most of their investment. Selling BWNG now makes little sense.
* The reintroduction of the dividend and a rising share price over the next 2-3 years will make the majority shareholder significant sums. i.e. There is zero point in selling now at a bargain basement price.
* What’s happening currently could very well be a defensive move from Alliance (and maybe Frasers?)
Good luck, Brighty
If a bid or similar will come out of this , then great. But the players are longer term strategists. Another scenario is that the group has successfully migrated from a catalogue supplier to online gaining new and younger buyers, overcome hiccups in changing accounting for credit sales and finally settled the longstanding dispute. This leaves a solid long term viable and profitable operation. A return to a reasonable and growing dividend is now feasible and should result in a major rerate of the share price. May take a year or so but a win for every shareholder
It's the one thing that's hard to add up in all of this.
Thanks camo, I also wondered if Brough and Ashley have made some sort of side deal.
Thanks Adam, I also thought it possible that Brough had simply had enough. If we accept that Brough is an astute investor and wouldn't sell out unduly cheaply (as he sees it), then your idea that he may have factored in a stalemate outcome rather than a rocketing share price due to a takeover scramble, comes into play.
Sorry to repeat myself, but Ashley doesn't like overpaying.
Following is an attempt to make sense of this conundrum.
Andy Brough may have decided to sell because (1) he sees better investment opportunities elsewhere and because (2) he believes, from what he knows of the Alliances and Ashley, that neither party is going to be willing or able to mount a successful bid, for a variety of financial, arithmetical and psychological reasons. Had he not sold, which is what has triggered the bid speculation, the share price would most likely still be at 28p-30p, the level at which he was willing to offload his shares in the first place. By selling when he did, a short-term surge in the share price has been created, which will be sustained only if there is a successful bid, an outcome he has concluded (rightly or wrongly) is not going to be achieved.
Brough could have continued to hold the shares, on the grounds that BWNG is substantially undervalued. But people – including Brough himself - have been saying this for years yet BWNG retains its lowly rating. He may have decided that enough is enough.
It seems plausible that, as evidence emerged that the Alliances (Lady Homa) were buying, Ashley stepped in because he feared (rightly or wrongly) that a move to take the company private was afoot and he wanted to preempt this. My guess is that such a move was not afoot and the purchases were in fact defensive. Ironically, rather than discourage Ashley, they forced his hand.
As Beechhurst has helpfully demonstrated, Schroders are not the only ones who have decided that enough is enough and there is another big seller in the market. Most likely this is one or more of the other funds, but there is perhaps an outside chance that one of the Alliance family members is also looking to scale down their holding. (Before Schroders RNS, I toyed with the idea that David Alliance was the mystery seller, but we now know that this was not the case. Had he been the seller of part of his stake, the chances of an agreed sale with Ashley would have looked promising. Since there appears to be no inclination to move in that direction, a protracted stand-off looks more likely.)
As a holder myself, I would be pleased if there is an agreed sale, at a level significantly higher than today’s market price, which would unlock value for all shareholders. As has been commented elsewhere, if Ashley does bid, a cash plus equity offer looks considerably more probable than an all-cash offer. That would of course still push the price up and give shareholders the opportunity to exit profitably (hopefully).
To speculate. If they own like 1-2% of frasers, maybe its in their interest to hand over shares to Mike as they know the upscaling it could do for Frasers. And maybe they have some deal with Frasers. All speculation at this point. As you said, makes little sense so just trying to make some sense out of it lol
Why would they sell their stake in the low 30s, if they knew it would likely kick off a takeover battle, with a rising share price? Doesn't make much sense. I mean, Andy Brough of Schroders is quite matey with Ashley and was once quite bullish on BWNG. Why take the loss knowing the share would likely surge immediately after the sale?
Any ideas?
https://www.business-live.co.uk/retail-consumer/shares-n-brown-continue-rise-26126215.amp
This has so much more to go now the settlement has been reached.
If Fraser group were to have a bid accepted for Nbrown that would short cut Mike Ashleys need to get a financial service regulated as NBrown have the financial lending arm well established.
Ashley has £305mil from the sale of Newcastle FC burning a hole in his pocket.
Net asset value at Nbrown of 64p so this still looks incredibly cheap should a bid be made.
I suspect the Alliance family will be pushing fir a price north of 70p per share.
Interesting times here.
Saturday's Telegraph:
Mike Ashley’s Frasers Group is finalising plans to lend customers as much as £2,000 and let shoppers buy products on credit in a major push into financial services.
Mr Ashley’s retail group is preparing to launch a suite of financial offerings under a new “Frasers Plus” brand, spearheaded by chief executive Michael Murray.
A senior City source said: “Ashley’s really excited about credit. He reckons Frasers’ bottom line could be boosted.”
Frasers Plus will offer two main products: a buy-now-pay-later facility that will let customers pay for purchases over time, with Frasers Group covering the cost up front; and the ability to take a loan through the app that could be spent across the group’s retailers.
Customers will also be able to combine multiple buy-now-pay-later purchases into a single loan through Studio Retail, formerly known as Findel, the Financial Conduct Authority (FCA)-regulated business that Frasers acquired out of bankruptcy a year ago.
Technology developed by Tymit, a fintech startup in which Frasers has a 20pc stake, will be used for online payments.
It is believed that Frasers Plus could offer loans of as much as £2,000, which could be pooled for purchases across all of the group’s brands such as Sports Direct, Flannels, Evans Cycles and House of Fraser. Final details have yet to be agreed with regulators, however, according to industry sources.
Mr Murray is understood to believe that Frasers Plus’s standing as a regulated entity, through Findel, will set it apart from rival buy-now-pay-later providers such as Sweden’s Klarna.
The decision to offer financing in-house is a departure from rivals such as JD Sports, which relies on buy-now-pay-later payments provided by outside companies such as Klarna.
Bringing financing options “on balance sheet” will allow the company to boost sales while still retaining funds that would otherwise need to be paid to third parties in fees.
Frasers is hoping the initiative will enjoy similar profitability to other major retailers that offer purchase on credit. Next generates around £150m of pre-tax profit annually from its credit offering, Next Finance, for example.
Mr Murray is understood to believe that being regulated by the FCA should help soothe concerns that customers could be persuaded to buy unaffordable items.
“To be regulated is an enormous process,” said a source familiar with his thinking. “You need a track record of prioritising customers and treating them fairly.”
Https://www.telegraph.co.uk/business/2023/01/28/frasers-group-boss-mike-ashley-plans-major-push-financial-services/