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Think this will drift down to sub 15p with the remaining cash from the on market buy back used to prop up the price from hitting 12p being the cash value of £23m and 186m shares.
Expect a long quiet summer till Autumn when things might open up.
I think there could as easily be an extended period of lower volume trading with wider spreads, making it more difficult for the company to buy back without pushing up the share price. With 40% fewer shares in issue the proportion of longer term holders will have increased, whilst speculative traders who tendered a large portion of their holdings now have fewer shares than before.
I therefore predict an increase in activity on this BB from those speculative traders, who will try to influence people to sell their shares. I also predict a steady increase in their nervousness that the release of positive news by the company could lead them to be unable to reinvest any significant sums back into this lower liquidity stock.
Loam are the longest term holder on the share register having been a holder pre IPO.
They tendered their entire holding ..are they long term or speculative in their approach? Labelling those who took part in the tender as speculative traders is rather bogus…they just knew what would happen and acted accordingly.
As to how the buyback is being done it appears strange there was normal reasonable volume end of last week and they did not participate. Most buybacks i am aware of who have a broker managed arrangement will execute even relatively small amounts around pre set parameters so suddenly just stopping is odd and there is not easy explanation..maybe the guy that does it at Cavendish is on his hols!!
Those who predicted the price would not fall back as there would be no sellers post tender maybe need to reflect more on previous predictions than make new ones?
Spot on Kooba :
When will they ever learn !
Liquidity levels of this stock are low enough that the SP doesn’t tell the whole story.. For example, today’s total trading volume was just £27k and only £1,350 were bought at under 18p.
If the company had tried to buy back their recent “usual” of £49.5k today the asking prices in the book were up to 19.36p (with an average asking price of 18.82p). So maybe Cavendish decided not to do that, as it would have pushed up the SP.
It doesn't completely make sense to me. They could simply put an order on the bid side at 18p and let the market sell them as many as they want. I suspect there is something more to this "pause" but remains to be seen.
Paul, the only thing is they wouldn’t have bought much more than nothing if they’d set a bid at 18p… Only £12k of shares have been bought to date at 18p (or a fraction under). And all those £12k have been bought by others, so they might not have got many of those anyway. With £1.7m in their pocket that would be small change for them.
Not true there has been a fair bit of trade below 18p and they were even freely offered on the RSP s below 18p…I know because a bought some ( more than £1350 worth !!)
Agree Paul as an order book the broker could just work the bid and have got quite a few below 18p.
Why be almost half the volume at higher levels and nothing down here ..it’s not volume related ..they are not buying any , decisions have been made , and there’s no point in making stuff up.
Shareholders gave the company authority to buy shares back in the market , the company gave their broker instructions to do so..the company and Cavendish apparently think the shares are cheap yet having paid 23p for shares they now aren’t participating over 20% lower a few weeks later…all rather strange!
Kooba
Unless of course your LOAM off loading shares on certain days 'knowing' they would get paid 23p by Cavendish for their shares...or the highest trading price in that particular week!
Conspiracy theory anyone?
Loam had 16,945,280 shares post tender representing 8.51%.
If they sold more that 1m shares it would have moved them below 8% and they would have had to announce…or definitely should have. So doubtful that they have been a meaningful seller.
They did buy stock in the market around 23p when the directors sales to meet tax obligations were made..so that was lucky.