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Timing about right mid February
https://what3words.com/pretty.needed.chill
Https://what3words.com/news/general/boohoo-group-now-delivers-to-what3words-addresses
No problem Rob
Thanks DJP
I appreciate you answering my questions
I was unsure if the RTO happened how it would unfold.
Thank you, you are much better than Google :-)
Your shares won’t be bought from you, you’ll retain your shares on both scenarios and you’ll be able to sell them on market again after the RTO is completed, providing their is sufficient liquidity to do so. If after the RTO volumes remain poor, and liquidity is similar to now, then you’ll unlikely be able to sell many, I know I’d likely struggle to sell my holding in a month with current liquidity levels let alone a day.
If the deal is good volumes will pick up naturally and hopefully after RTO it'll run much higher than RTO price
Like I said in previous tweets, I got my .3p base case RTO price on the fact LSAI have £3.5-4m cash and £4m deferred tax asset, that alone should value LSAI as a shell at around .3p per share - if the management pull off an RTO at a greater price than that even better.
Thank you for the insight, different from what I have been reading, but still a little confused whether I keep my shares to sell when I want or get the agree price for my shares at RTO
I’m no expert at reading financial statements but in the financials reported March 2022 it stated
Potential deferred tax asset of £3,977,000 (2020: £3,840,000)
The other way around it would be a full cash offer from the public company for the private company, buying the owners/vendors of the private company out and such wouldn’t need to issue any shares to the owners as it would be an outright buy out.
Where as my first scenario, the vendors in the private company would remain shareholders in LSAI and LSAI would remain with a health cash balance as they didn’t use cash to do the RTO but issued shares.
That’s the 2 ways of doing an RTO
Not the case.
The public company would issue shares to the vendors of the private company at an agreed amount and price.
For example, LSAI would negotiate what price they thought was fair for the incoming company and what price was fair for LSAI share holders, they would then issue shares in LSAI to the owners/vendors of the incoming company likely with a lock in for an agreed period usually 12 months from the date of completion of RTO, at the price agreed.
So if they valued incoming business at £10m and agreed 0.5p in LSAI shares was a fair price the vendors would be issued 2 billion shares in LSAI.
If they valued the incoming business at £10m at an agreed 0.4p in LSAI shares was a fair piece the vendors would be issued 2.5 billion LSAI shares and so on and so on.
Also is the tax not 22 million
All the information I can find regarding RTO the public company shareholders get bought out by the private company, if so how can they exercise the nontransferable warrants after a RTO or do the public company( LSAI)retain their shares in some cases?
I’m merely speculating on what price I think may fairly value LSAI as a shell. With the deferred tax asset and cash, .3 probably is fair value, that doesn’t mean to say they won’t do a deal at a much greater price, I’m sure the concert party and management will want a deal as high as possibly also considering everyone is fully aligned.
Not long to wait for an update now as financials due any day this month and also interested to find out current cash balance i anticipate £3.5-3.8m as of today so roughly .13-.14 per share worth.
What could also plausibly happen prior to RTO, which would show massive confidence to market and I’m sure a big spike in share price of management wanted the share price higher, is Wilkinson, Mahmud and Hughes exercising their 500m warrants each early to inject another £3m of cash in LSAI, although I reckon this is more likely to happen on or after an RTO rather than before.
We are all convinced there will be a RTO
I will be sitting on a massive loss at .3 need .65 the SP was that not that long ago, if it’s.3 I don’t think they would have done a great job, so what happened to all the non-transferable warrants ? And all the 150+ customers.
I hope there a another option
3 pence would be lovely, but it’ll never happen in a million years, yes I meant .3
I agree, I hope you mean three pence and not .0030
No problem.
Baring in mind everyone involved including Nigel are aligned at 0.2p, which he also reminded me of in the email, gives me encouragement that they will, eventually, being a deal that does create value and at an equal price or likely higher to their entry.
Can’t see the likes of Hughes and Mahmud having their money tied up for over 2 years and not making some sort of return on that investment. Think we’ll see an RTO at 0.3p+ I don’t see that out of the question at all. Obviously the higher the better and with the £4m deferred tax asset they have on the books and the cash levels I think 0.3p is very realistic
Thanks - appreciated DJP
I don’t generally like posting emails that I’ve exchanged with directors but without copying and pasting he said there been lots of activity behind the scenes and they’d looked at over 20 targets some in significant detail, The difficult economic conditions of the past year or so have not made finding good deals any easier though.
He also said ‘I'm pretty confident that we'll identify a deal that creates value rather than doing a poor deal for the sake of announcing one’
And finished with, which I thought was the most interesting part of all - Thanks for your support, we'll do our best to justify that in the coming months.
Baring in mind this contact was in February so hopefully in news window now.
I urge anyone else to reach out to Nigel themselves, he is incredible responsive and usually replies same day!
@DJP -can I ask, did Nigel give you any kind of hints, or indicate any other issues when you spoke with him? Did he concerned at all, or perhaps excited?
Agree that accounts should be easily produced here.
Just need to wait and see.
Surely RH and his Zeus connections can ultise this shell.
Lots of ifs and bits and guesswork, but until we are updated it is simply just that.
I have a large holding for a very illiquid stock, but take comfort in the fact that the names on the share register didn’t get to the position they are in by injecting funds into a company to lose money. Something will be done and I sense relatively soon
Sorry but there should be no reason not to have accounts filed by the deadline and therefore avoid suspension. The company must be a breeze to audit and produce accounts for given its lack of trading activity!
I do wonder in truth if the lack of activity might in fact be the reason for the delay - I think I am right in saying that under AIM rules a business must continue to trade to remain listed, so if the accounts were to show otherwise....?
But then DJP has it from the horses mouth that the delay owes to nothing more than backlog at the auditors, and so I suppose we will have to take that at face value even though it seems convenient.
Sorry, suspended not delist