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It will have to be high enough to satisfy more than one major shareholder. I suspect people will be surprised how high it is and those who sold since last Friday will be kicking themselves.
Company is in troubles and is not profitable, can equally be picked up for cheap by bidders (if in the end after checking with CFOs for financials it really becomes plural), as paying high price may not be justified from investing perspective.
Yuri, do you work for one of the bidding companies by any chance? The sell-off at Lamprells was massively overdone especially given the recent contract pipeline in the Middle East. Any offer must exceed 12.5p and probably much more.
As well as In April, it signed an early stage deal to fabricate 200 turbines for floating wind farms to be installed west of Shetland. That must have some good profit in it?
Imo any bid below the last year's capital raising price will get rejected, for multiple reasons though the main ones being the assets of the company and the size of the order book. At this price he will still get a bargain, and by taking it private there will be an end to this ridiculous farce about funding where placing have been oversubscribed one month and then not achievable the next. Lamprell is a strategically important company for both the UAE and Saudi Arabia and the sooner this matter is settled the better.
A huge benefit for the buyer from Middle East - the dollar / gbp exchange course is amazing low.
Last year 28 oct 21 , when we raised money and ask was 32p a share we had an exchange course of 1GBP = 1.38$ and now the exchange rate is 1GBP = 1.21$. Assuming they hold their money in dollar he has already a nice tailwind to acquire Lamprell.
32P would be nice !!!
GLA
SS - blind rejection without offering alternative option to finance operations might end very badly, it's rather like shooting own foot. Delays in project delivery may lead to contract cancellations and loss/write-downs. Without financing (as the say "bridge finance") project delivery in-full and in-time is in jeopardy (base interest rates are on a raise, risk premiums are spiking). With required financing company will not necessarily get above break-even (net) point (due to overhead/office costs). Debt financing is expensive in current environment (it will have to be secure, would require significant collateral to back it up) considering risks. Financing it via equity raise will be highly dilutive (and will take longer time, first rig should be finished this year as per plan and second in jan-23).
I'm not sure how flexible they are about reshuffling financing between projects by suspending ones and stream-lining others.
IMO - they do have a very short time to pull this off (I guess 3-4 months?), as already mentioned - existing shareholders might not be very happy with the outcome and whoever comes with cash package might benefit significantly.
Yuri,
I dont think you are an investor in this company! All you statements are extremely negative. Let me tell you one thing, this company is on a growth path and not planed to make profit. How long made Tesla losses ? Long, to the point it scaled with model 3. Even before model 3 drive Tesla to 1 trillion dollar mcap, the company was already worth 30-50B $. This is going into an offer and takeover.
1. shorter are ****ting daily now in their pants
2. Who locked in makes good money
3. Who sold last week … missed the fun
GLA
I'm not a holder but thought about it last week but didn't like the inevitable suspension looming.
The company does have a decent pipeline but that is in the future. In the here and now it has a market value of £37m per this site. This is dwarfed by the figure used in the 24 June RNS Trading/Funding update where the figure of £150m is used in the exploration of funding operations-equity raise. This clearly stated that the company was looking for up to the £150m by a mix of fund raise/interim finance.
Why then would any buyer look to pay even 8p with substantial funding still needed. The suspension gives them time to formulate a low ball offer and basically say accept it or we refuse to support the fundraise etc in which case the company goes under and they can pick it up even cheaper but have to go through a lot more legal bumpf.
The funding is easy to explain! Due to long production process their working capital need to be increased - thats nothing bad when you grow, a normal thing. Tesla was no different. The process can now take up to the 29th of July. This is now my 4th company where i had invested and was taken over. My assumption of sales price are 17p.
@scrwal Sami Al Angari increased holdings last week and that offer has to be at least 8.5p
Agreed! I’ve had shares in several companies in the past. All had increased prices after takeover and suspending shares.
A normal practice is highest bid price and a premium on top.
Such premium is often around 35% but there where SP was extremely undervalued and massive future potential i have seen premiums over 100/200%
Nothing untypical
Thats the reason i imagine 100% premium is acceptable.
Still under the value of SP before crash and only 50% of the SP from last years September Share placing.
The possibility of a rights issue still shouldn't be ignored. IMO any instruments that sold shares last week did so because they were not prepared to put more cash in. I'd give it a 50 50 chance.
Typo - institutions
Here again the money is needed due to the fact that working capital need to grow as business is growing. With scaling into growth the margin position will improve. I am as well sure that the maintenance of their equipment produce as well nice additional margin. A young company on growth path!
Here another example, Blueprism made zero profit for years and asked every year via placing for more money. It was sold with 35% premium in the end. However shares had not such aggressive downside as here just days before offer.
https://techcrunch.com/2021/09/28/rpa-industry-consolidation-continues-with-sale-of-blue-prism-to-vista-for-1-095b/
See it the other way around, he bought 19% at max of 8.5 Penny / the other interested party has 25% and they paid 34 penny last year. So now the question is who will win ? Bidder 1 and require 25% with a loss for the other major shareholder or the 25% party increase its bid and the guy make a bid win?