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Unfortunately INFA have a track record of taking on expensive debt to burn shareholders...then issue really low rights issues and kill the share price. H&W is a massive liability burn and with expensive debt and no income I just don’t see the exit. In between, people might get a little bit of share pumping and herd following but let’s get a bit more technical here on the financial basis - taking in expensive debt into a dry asset with real monthly liabilities isn’t clever.
With the projects INFA have now it will save £££££££ millions,Plus there will be local contracts, INFA are becoming a one stop infrastructure shop for the energy sector- GREAT PURCHASE AT A MASSIVE DISCOUNT. IMHO
Understand what ewing is saying but mr wood knows more than us and imo i think it will be passed like he dose seem to think . Remember you dont invest 6 million with out your ear to the ground .This tells me he is in with the right people and by buying the yard i cannot see no problems . If any think it looks lie a cert
Whatamess,
Bang on with your view, I'm afraid our friend Mr Ewing is living in the past and can't grasp why Infa have purchased these assets at such a knock down price??
He will eventually I'm sure if he keeps looking at the RNS!!! and then maybe understand the financial savings to Infa and the IM project as a whole.
Also yesterday's RNS demonstrated that the board can raise significant funding/loans should the need arise? a very good point in view of the need for raising to fund the IM project at project level of course.
Mr T
Meant - looks like a cert
Spend £6mill to save £40 mill on one project- No brainer!
Another thing better to have it in house and the locals are happy there part of it . Mr wood has played a blinder
The PR alone is priceless!
I am not doubting the raising of money. I just know how hard these types of projects are on the existing shareholders. No debt comes with less asset security and no equity comes with massive dilution. I am looking at this from a shareholder and risk perspective as I know how deep your pockets need to be for non-income producing project of this scale and unfortunately shareholders get hit with dilution after dilution each time there is a cash call.
You got any positives then JR only I've never seen you contributing on this bb before
WHY GO on boards if your not invested its a waste of time surely unless your lonely which would be a shame
Positives are that I hope it works out for the workers of H&W. They deserve a strong employer who will look after their rights.
I like to be educated. Not lonely just curious.
I am not in the haters camp despite what Speedy claims - just providing a balanced voice on the board. I simply don’t understand how a company without any money agrees to buy iconic cranes in Belfast knowing they have a massive liability burn. I fear it is going to be a long cold winter. If there was funding already identified the board would be obliged to Disclose that to investors so let’s move forward with eyes wide open till a more meaningful legal agreement is signed. Let’s hope Unite union have done their homework and due diligence and this isn’t a publicity stunt.
Government (Westminster and absent Stormont) are not about to let this fail, giving the broader political context. This is rare good news story amidst the gloom. We have bought more than publicity...
JR
If you wish to be educated I suggest you fully read the RNS re the purchase of H&W, you will see it will be run as a separate entity and working capital funding will be sought.
The business comes debt free as it has been bought out of administration, so the basic maths re
Cost 6M
Loans/equity to purchase 6M
Value of asset conservatively put at 11M
Therefore this business will restart as a new entity, as I say, debt free? Apart from the loans and equity to purchase. Essentially a fresh start but the important caveat is, not only have Inca acquired the assets, they have acquired the name. They will then look to acquire new business, but the business will be underpinned by the work they will be involved with in respect of the IM project. Therefore cash flow will be incoming from that project and hopefully other projects will come on board.
Its a no bringer for Inca as the goodwill it promotes in NI is priceless and it will ultimately save Inca costs in the overall construction of the IM project.
As I point out you refer to massive liability burn, I assume you refer to the H &W business pre administration? This is a totally new business with no debt apart from loans to purchase. I have to say most large construction businesses retain bank debt to operate, its all about how that is managed and kept with certain levels so as to be able to be serviced by income streams and profits.
This could be a masterstroke of JW's imo, lets see how we go once all of the agreements are finalised.
Mr T
thank you for your thorough response Mr T and I do admire your optimism. I also agree that the NI Government really will not want this to fail.
From a shareholders perspective the reality is that we have a large monthly burn of workers wage bills, site maintenance, board wages, nomad fees, legal bills, rates liabilities, interest on debt and all the standard daily bills that land in through the door when owning a listed asset of this nature. On the income side INFA have nothing solid...just a lot of future hope on this share chat board whilst being caught on the dirty side of energy and gas storage whilst the world and Belfast is announcing climate crisis. Monthly cost burn without income is perfectly fine if the site was owned by a company sitting with lots of cash on the balance sheet as it can afford to make non-rash decisions and still meet month end payments ...but for a cashless entity like INFA it might be a step too far.
I do fear the Government will have to write future large cheque of support into INFA and this site.
Asset value in this case is very subjective and I am sure any affordable banking partner will look at interest cover lending and future earnings. Let’s hope income comes quickly so that INFA doesn’t just burn the expensive loan and then dilute all the shareholders in a silly rights issue rate like it has done over and over and over and over and over again.
JR
You are right re monthly cash burn in respect of the items you flag up.
However would you not think there are contracts in the pipeline to facilitate these costs, I would doubt very much if this was brought on the off chance there may be contracts to come in? In fact I would be amazed if these are not already sorted, the IM project should come on board in earnest in 2020 therefore contracts will be required to generate cash to meet the bills.
I would urge to stop thinking that infastrata are running this through their business, this will be run as a separate entity and therefore it is irrelevant that Inca has little cash. Although once the 1.6M is received from the EU then infa will be fully funded.
Finally, I would not want your other suggestion other, a company with no contracts but its ok because they sit on a mountain of cash to support it? Not very good business sense is that I have to say.
Are you a shareholder JR?
Mr T