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Broker instructed to vote NO to Budco
Game On - Interesting 4 weeks ahead - looking forward to another bidder appearing now Budco have published terms - hope they get pipped by a much improved offer
No need for any of that - we are just in waiting mode. If the bid is successful we get £5.90 a share but its looking likely they will have bid higher if they want PAYS.. If it fails we carry on as usual - the SP may fall a bit but not much. If we get another bid that is successful we get more. Just hold and wait.
I'm all of the above...anyone know what's going on now?
Glad I took some WPG now - still going up maybe they'll make a bid for PAYS next. Still holding my PAYS hoping for a counter bid!
the SP is higher than the proposed offer. Not a peep from anyone on the board as to why. Is another offer on its way. I ask the question on this board as its relevant to the PAYS situation
Personally I would like to see the bid fail and no more bids on the table. If left alone I believe the PAYS SP has every chance of doubling over the next few years - it is a great investment!!
Do we know what the timetable is? I've read through the bid documentation, but it appears to only explain the procedure and doesn't provide a timetable.
Reported this morning. Was reported as a buy but who knows? Wonder who that is?
Cheers Wicket - being on the right side of a sp is the only place to be :) In that regard sp may tread water for a few weeks, my gut tells me that Bidco will be forced to come up with a higher offer to win 75% support required from shareholders. II's have 61% and pi's the balance of 39% - so far they only have 2% irrevocable ( JL & BMM the CFO) + 14% expression of support ( but no commitment ) from Old Mut & Thread need - other ii are keeping powder dry. In that regard if I were a counter bidder I would let bidco do the leg work of finding where ii's feel is a reasonable level ( bear in mind Barclays 700p target price due to US acqn alone + some premium) and then I would trump that offer. All of that takes time to happy and folks will keep cards to their chest whilst doing it. With current bid price at 14 x EBITDA - I think there is plenty of headroom left in the bid price for some decent gains to be had - at worst case we get taken out for all cash offer of 590p - win-win-win scenario
Thanks Wolfhound. DYOR and all that but I am grateful for your views. I'll ride this out; I don't get to be the right side of a share price that often!
There are 3 ways things could go : a) Pays gets taken out at t a premium to current 590 ( anywhere from 15-25%+ and possibly higher if a bidding war commences). - I attach a high probability to this outcome. At 14x EBITDA relative to a Worldpay being acquired at 30x EBITDA - it is a cheeky low ball offer at 590p. b) BidCO succeeds at 590p - so they will need 75% shareholder approval - tough ask as ii's hold 61% and have not realy come out in support of bidco - I think they are like pi's waiting for a rival bid. Even with 100% ii's they need pi's also. I certainly won't be lending my support to a low ball 590p c) bid fails and we go back to before - except I don't see a short attack this time for the following reasons : * cried wolf (c the irony lol) and now we know why - faciliate a low ball bid * dd has been done on asian gateway and we know it contributes $50mn EBITDA (1/6th of total pays)and has a buyer for $308mn- whether or not Spectrum or the eventual buyers * US acqn of MCSP further diversifies revenue and also contributes $50mn EBITDA to offset asian sale. * Sector is alive to M&A risky ti attempt a large scale short * Share buy back is still technically in operation. That is not to say sp won't slip back temporarily if deal collapses but IMHO it will jump up fairly quickly. Also worth noting that Barclays have put a 700p target sp on the share just based off US deal - Asia whatever happens will now probably be sold - that pushes target sp to 850p on a rerating closer to peers. In a nutshell there is far more upside than downside by a country mile !!!
Thanks jh, appreciate the feedback.
have a look on the ADVFN board..it is more active. Some have sold and moved on. Taptica, XLM a,d IQE seem to now have PAYSAFE refugees active. They are those that believe they can make more than 10% in other shares while they wait for this to play out. Others like me, are actually buying more on the grounds that 590p is effectively underwritten, and hoping the 1st bid is not succesful, and a second higher bid, and perhaps a biffing war....So a bit of a 1 way bet in my opinion...but DYOR as always
I'm watching the price drop daily and now at 585 with an offer at 590 and this board has gone a bit quiet...has everyone else sold out and moved on? Or is this expected by those of you far more familiar with these things than I am? I would be grateful for any insight. Thanks.
Even the announcement refers to "Robust" results. EPS up 25%, adjusted profits before tax up 25%. Earnings 25p per share first 6 months, means 50p per share over 12 months even assuming no growth in the second six months, which equates to a p/e ratio of less than 12. How much more is required? All demonstrates the true value is significantly in excess of £5.90. DYOR
agreed - bidder will just have been waiting to confirm there was no bad news in the results ( which there isn't) I noticed the Google tie -up was buried in the release and hardly got a full sentence in the update I suspect that results are now out of the way - bidders will be sharpening their pencils
Obviously a stitch up to forward the BOD's agreed bid - a bit of a non event. If there is another bidder out there this will make no difference.
Results seem quite disappointing. 11% revenue growth is below expectations. Suddenly quite glad we have a bid on our hands.
Thanks for all the great analysis you do here wolfhound.
What we need now is for the rumour mill to get going to push up the SP - has anyone heard anything??
No doubt Barclays will be doing a note on this but I have just looked at the numbers of the Acqn of the US business and the sale of the Asian Gateway and here are the summary results : Asian Gateway EBITDA -$50mn with proceeds $ 308mn ( over 5 yrs) US MCSP EBITBA +$49mn with cost $ 480mn ( mostly funded in new Debt) and Tuesday next will see the trading update to see how 2017 is going - lets say 20%+ So seems a very straightforward swap - for $162mn PAYS solved the discount issue of Asian Gateway yet is being bid is only a PE of 14 ( possibly fall further once updated for above) and you have shareholders from Worldpay objecting at PE of 30 !! I can't imagine ii's going for 590p on a PE of 14 Won't take long for the likes of Wirecard etc.... to see that they have an earnings accretive bolt on with wallet ( which they use) there for the taking at say PE of 20/25 ( still massively earnings accretive) and minus the poison pill of Asian gateway for a known amount and with no IPR tfrd ( neteller not part of Asian gateway deal) !! Let the bids roll in !!!
I'm just thinking of it as a freeroll. If the offer goes through at 590, nice profit for me. The fact that the share price is above that means I could sell for a little bit extra, or risk that tiny bit extra for a chance at a lot more. Seems like good odds to me. Holding.
We are all in the same boat here......we are all trying to maximize our return on our investment in PAYS. At 590 we are all in the money, other than those who have bought in to PAYS above 590p on speculation of a counter offer. The chances of a counter offer coming I would think is greater than 50/50 and if it comes to pass we will all gladly accept it. As PI's we don't have any say in what ultimately happens PAYS, but we do have a choice of getting out now at c.596p, OR wait to see what happens, in the knowledge that we will receive a minimum of 590p. Who knows what will happen on Tuesday when the half year results are published, but I would suggest that these results are already priced into the current price of 596p. At 590p I am up c 30% so I will sit this out and when the cheque comes in the door I will hopefully find another company that will give me a 30% or better return on my investment. Good luck to all and lets not forget why we invested in PAYS in the first place.......lets not get sentimental about PAYS......its just another investment.........
The first part of what I suggested has come to pass, i.e. a formal bid before any counter offer. The shares are worth more than 5.90, but that is now wholly dependent on a counter offer, which is wholly outside PI's control. We know the shares are worth more than 5.90 because the consortium would never have put in their highest price to start with, they want as large a discount to actual value as reasonably possible. It is only a question of which organisation if any is prepared to buy with a smaller discount to actual value of the business. I agree with all others that any counter bid is likely to be after the results next week and I was quite surprised to see a firm bid before the results.