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Per the document in response to the resolution the Board stated the following:
6.
Recommendation, voting intentions of other large Shareholders and importance of voting
The Directors believe that the passing of the Resolution is NOT in the best interests of the Company and Shareholders, taken as a whole.
Accordingly, the Directors unanimously recommend Shareholders to VOTE AGAINST the Resolution, as they will do in respect of their Ordinary Shares in the Company, representing in aggregate 2.7 per cent (%) of the Ordinary Shares in issue as at the date of this document.
Based on discussions to date with other significant Shareholders that do not want the Company to pursue the MVL route, the Board believes a further 3.7% per cent of the Ordinary Shares will be cast against the Resolution. Given that the Requisitioning Shareholder holds 8.8 per cent of the Ordinary Shares, the Board stresses how important it is for Shareholders that support the Board’s position to vote against the Resolution to cast their vote."
The Board therefore has 2.7% and they believe 3.70% will vote with them, note that it does not say shareholders with 3.70% have committed to vote against the resolution, but it says we believe!
I would hardly call 3.70% excluding the Directors 2.70% voting against the resolution being great endorsement and support for the Board!
AGE
You go onto your stock brokers website and look for the section which says voting mail box .
On the ii website you press the button on the left which says vote and not the button on the right which says company site
AGE
Can someone direct me to the online vote form - all I can find is a pdf. Thanks
And the Board members will love to another pig trough to stick their snouts into
As I said.
Once the shares are suspended that will be it as far as buying and selling them.
Delisting will follow and you will get your distributions according to the number of shares held.
Once the final distribution is made in however many years the shares will cease to exist.
Little_me your are correct.
What you paid for your shares is irrelevant as each time there is a distribution you receive the distribution per share multiplied by the number of shares that you own.
The proceeds from an MVL can be paid in a lump sum or through a series of installments.
Per the internet:
"• Members’ voluntary liquidation (MVL)
A members’ voluntary liquidation is a formal procedure governed by the Insolvency Act 1986 to close down a solvent company. Before the company is closed, its physical assets will be valued, sold and turned into cash by a licensed insolvency practitioner.
With an MVL, all distributions to shareholders are subject to capital gains tax.
I would imagine that the majority of the SCIR Shareholders will have an average share purchase price way in excess of the total amount they will receive under the MVL so if their shares are held in an ordinary share trading account .i.e not an ISA trading account then the amounts you receive on each distribution will reduce the tax base cost of your shares.
If you hold your shares in an ISA share trading account then as there is no CGT on gains or income from shares held in an ISA then you will not be able to use the loss.
So for example if your average purchase price is 5p and you get back 1p and you own 100,000 shares then you will receive £1,000 in cash and you will have a capital loss of £4,000
The majority of us will therefore end up with a capital loss.
AGE
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I assume if/when the remaining funds are returned to shareholders the payment will be determined by 'who holds shares' on a particular date, and no consideration is given for those that have been drained of their investment for 5 years or longer. Everyone will get the same share payout regardless of the 'age of the share'
If the vote goes FOR …the £4m goes to the share price…based on number is shares in issue the share price will jump to 1.2p then the company will be removed from AIM, and close, not a moment too soon in my book, vote against, and the maggots say they will use the £4m to look for assets…based on past history they’ve done nothing since the Ritson days, and this is the end result, in a nutshell…complete failure. They board drain this company dry, and want a AGAINST vote to keep the lights on, and salaries being paid,
Should be a cut off date.
The shares will probably get suspended so anyone holding will be locked in.
I assume if/when the remaining funds are returned to shareholders the payment will be determined by 'who holds shares' on a particular date, and no consideration is given for those that have been drained of their investment for 5 years or longer. Everyone will get the same share payout regardless of the 'age of the share'
Well, I’ve said this all along, company has 4m in the pot, and boards salary’s will absorb that in the next 2 years, plus overheads, you vote against…and they continue to reap the rewards and produce nothing, you vote for and the company closed and these maggots are on the dole. Or onto the the next gravy AIM train, (SAME AS UKOG)
For a 1.2p share price if cash goes to shareholders….im taking it and bailing out, at a massive loss, or we leave it and the little bit that’s left goes to the Board maggots,
I’m voting FOR
And they can shove this company up their backsides as far as they can get it.
ValdisereOily sorry to hear you have lost so much money!
I wonder how much the total loss would be if you added up the losses of the 100 or so members of the SCIR Shareholders Share Action Group it must be in the region of £3m to £4m perhaps more!
I agree it is very annoying that the Board try to blame shareholders when they are the one's who make the decisions about how to spend the money and what to invest it in!
If they had spent the shareholders money more wisely and not paid £2.132m to Gneiss Energy as well as other amounts then there may have been the chance we could have retained Ruvuma.
It is very annoying to think that the Board made the decision to change SCIR's strategy and to sell Ruvuma at a loss of £7.813m and to then provide a loan of £1.5m for EAG to acquire GGL having paid someone £100k to carry out due diligence on the acquisition to then sell EAG/GGL for £702k and make a loss of between £725k to £875k!
When I used to work in the Central Finance Team of a well known PLC I used to have to take part in an annual review and my boss would set me targets each year and then the following year he would evaluate my progress in achieving the targets and then set targets for the following.
I recall him sending me a rather funny email re comments that managers had made about the people who reported to them and one them was an absolute classic "This person is depriving a village somewhere of an idiot!"
AGE
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Fellow shareholders, I can accept a lot including my current losses of £145,000
I can accept that AIM is a gamble, that's fine.
However, I cannot accept the fact that the board continue to blame shareholders for their failings.
Therefore I have voted my 4.9m shares in favour of the resolution.
Good luck to everyone.
As have I voted to pay back to the share holders and all move on. Fortunately I had most of my Ruvuma pot invested with AEX (not that this has performed too much better so far) but still crying shame what this SCIR BOD have been allowed to do to the company and in particularly its shareholders and clearly can only be trusted with looking after themselves.
GLA
Fellow shareholders, I can accept a lot including my current losses of £145,000
I can accept that AIM is a gamble, that's fine.
However, I cannot accept the fact that the board continue to blame shareholders for their failings.
Therefore I have voted my 4.9m shares in favour of the resolution.
Good luck to everyone.
Some additional comments re my last post:
Why would the Board have been actively considering a number of pathways to distribute cash to Shareholders since Q2 2023 when the June 2023 accounts shows SCIR only has cash and cash equivalents of £295k and that they state that the Ruvuma receipts timings are uncertain?
If there is a pipeline of AD plants to acquire then surely you need to retain cash rather than return it to shareholders not only that you need additional sources of finance!
Why would the Board be seeking authority for the following which was one of the resolutions in the document issued on 14 July 2023 for the AGM :
"Accordingly, the Board recommends that, in accordance with section 551 of the Companies Act 2006 (the “Act”), the Directors of the Company be generally and unconditionally authorised to allot shares in the Company or grant rights to subscribe for or to convert any security into shares of the Company: (i) in connection with rights issues and similar offerings, up to a nominal value of £1,199,460 which is equivalent to approximately two thirds of the total issued ordinary share capital of the Company as at the latest practicable date prior to the publication of the Notice of Annual General Meeting;
The Company has spent time and committed resources over the last two years to identify and secure investment platforms and pathways which meet the objectives of the investment policy. The Company’s investment in Energy Acquisition Group (“EAG”) and EAG’s subsequent acquisition of Greenan Generation Limited and identification of follow on acquisition targets in the anaerobic digestion and biofertilizer markets, demonstrate the steps taken in accordance with the investing policy. The investment criteria are to invest in cash generative sustainable energy assets which offer the opportunity for improvement/augmentation with follow-on investment. However, in order to execute the current and future opportunities which have been identified in accordance with the investment policy, the Company must have access to capital in order to complete follow on acquisitions as they arise"
Asking for permission to issue yet more shares but considering ways to return cash to shareholders?
AGE
Well, after 5 years in this share its probably time to call an end to the debacle and the consistent burning of cash and bad management.
Just voted to return what's left to the share holders.
As I wrote before I must congratulate who ever created the Board's response document as it contains what appear to be compelling reasons as to why shareholders should vote however for my 3m of shares I have voted in favour of the resolution to return cash to shareholders and I have previously provided you with facts so that you can decide if you want to vote in favour of the resolution or not!
The Board's response document provides reasons as to why shareholders should vote against the resolution however the reasons contradict the Boards 2nd option as well as clearly demonstrating that Shareholders should vote for the resolution and not against it!
For instance
"The Board has actively considered a number of pathways to distribute cash to Shareholders since Q2 2023."
Why would the Board have been actively considering a number of pathways to distribute cash to Shareholders since Q2 2023 when the June 2023 accounts shows SCIR only has cash and cash equivalents of £295k and that they state that the Ruvuma receipts timings are uncertain?
In addition the 2023 AGM presentation dated August 2023 shows EAG/GGL is going to provide a substantial return to SCIR via an sale eventual sale of EAG/GGL after they had acquired a large enough portfolio of AD plants.
If you look on Companies House and search for Tom Hamilton Reynolds you will see that on 8 February 2022 he was appointed as a Director of EAG Eglington Ltd/EAG Ardboe Ltd/EAG Loughall which are the SPV Companies set up to acquire three AD plants that are most likely located at each of the names of the Companies.
Why did the Board did not provide a range of costs for an MVL as surely they obtained two or three quotes rather than just one?
If you seek a quote from one of the top firms who deal with MVL's then the quote is going to be a lot higher than if you seek a quote from a firm that is quite capable of carrying out an MVL but they are not one of the top firms!
One of the risks identified is:
"For transactional options in particular, is the target acquisition in an area where the Board has appropriate experience and knowledge to assess the potential."
The Board paid £100k for due diligence costs to acquire EAG/GGL which was sold at a massive loss so it was a third party that had the knowledge rather than the Board as why would the Board pay a third party to carry out due diligence if the Board had the knowledge?
EAG
I agree this BOD will try and string thing out as long as they can and take money out as salary until all the money has gone . I have voted FOR the resolution every little helps and may get it passed. I agree it has been criminal what this BOD have got away with over the years.
It’s hilarious what this BOD get away with.
Most shareholders now own a tiny amount and probably think it’s not worth voting.
Allows a select few to control the company with a large minority holding and make a lot of money through fees.
My view is that some of what has gone on here would warrant an investigation into whether the directors are acting in the interests of all shareholders.
I expect the BOD to win this one as well and we could see a rinse and repeat until all value has been stripped.
I thought the idea of running a business is that you have to buy low and sell high?
What would I know I only qualified as an Accountant!
So far Ruvuma sold at a loss of c 7.813m and EAG/GGL sold at a loss of between £725k to £875k depending upon whether the contingent consideration is received or not.
Per the Board's document below the keys word is potential and there was potential in both Ruvuma and EAG/GGL
"both these options have the potential to deliver value significantly in excess of that offered by distributing cash"
"To proceed down the path of distributing cash to Shareholders via a MVL limits the full range of alternatives to deliver value."
There is more certainty in a MVL and less risk!
Conclusion
To proceed down the path of distributing cash to Shareholders via a MVL limits the full range of alternatives to deliver value.
Taking account of the options available to the Company, the Board believes that the interests of all Shareholders are best supported by providing a defined period of time to end June 2024 to allow it to continue exploring transactional options in line with alternative 3, while also continuing to evaluate the potential of new investments in line with its investing policy, given the Board believes both these options have the potential to deliver value significantly in excess of that offered by distributing cash.
AGE
It is interesting to note that the expected net proceeds from Ruvuma were expected to be £11.828m on the 31 December 2021 however on 31 December 2022 it was expected to be £7.605m so a reduction of £4.223m in just a year.
The question has to be asked why did it decrease by so much!
It then increased to £7.986m on 30 June 2023
You will notice the wording Loan to ARA however ARA are providing a loan to SCIR rather than SCIR providing a loan to ARA.
The Board clarified the situation with the loan and that is that the loan from ARA to SCIR is not being paid out of the $16m it is going to be paid in addition to the $16m.
AGE
I said I would post some numbers re the sale of Ruvuma and the following has been taken from SCIR's accounts
31/12/2021
£’000
Fair value less costs to sell 11,828
Net book value of assets disposed:
Intangible assets (15,901)
Oil and gas properties (750)
Decommissioning provision 166
Impairment on fair value revaluation at 31 December 2020 810
(15,675)
Impairment on fair value revaluation at 31 December 2021 (3,846)
(4,656)
31/12/2022
Fair value less costs to sell 7,605
Net book value of assets disposed:
Intangible assets (18,368)
Oil and gas properties (380)
Loan to ARA Petroleum 2,944
Decommissioning provision 166
Impairment on fair value revaluation at 31 December 2021 4,656
(10,892)
Impairment on fair value revaluation at 31 December 2022 (3,377)
( 8,033)
30/06/2023
Fair value less costs to sell 7,986
Net book value of assets disposed:
Intangible assets (18,877)
Oil and gas properties (380)
Loan to ARA Petroleum 2,944
Decommissioning provision 166
Impairment on fair value revaluation at 31 December 2022 8,034
(7,765)
Impairment on fair value revaluation at 30 June 2023 221
Cumulative impairment (7,813)
You can see above that the cumulative impairment on assets held for sale is £7.813m which is the £8.034m less the reversal of impairment for the half year of £0.221m.
Ruvuma was therefore sold at a loss of £7.813m as the fair value less costs to sell in other the expected net proceeds from the sale of Ruvuma is £7.986m and Ruvuma cost £15.799m.
Some of the £15.799m must relate to Kilwani as the document that the Board had produced states there is a decommissioning provision relating to Kilwani in the sum of £166 k and you can see the £166k is included in the numbers above so the loss is less than £7.813m but I cannot tell how much of the costs relate to Kilwani ad how much relates to Ruvuma
AGE
I should have a typed a "a leopard never changes it's spots "
AGE
I have just voted in favour of the resolution to return cash to shareholders in respect of my 3m shares!
I would urge shareholders to carefully read the information that I have provided and compare it to the information that the Board provided in their response document and then make a decision on whether you should vote in favour of the resolution or whether should vote against the resolution based upon the facts I have provided!
I think 44J wise words below provide a useful summary of the facts and information I posted here today and yesterday:
"I agree with you Agneissearner; this BoD has been given plenty of opportunity to invest our hard earned cash and return a profit, but have failed to do so with each and every venture they pursue. Why would that change going forward?"
Think carefully about these two well known phrases
"Would Turkeys vote for Christmas!"
"Zebras do not change their spots"
AGE
Was EAG/GGL a wise investment considering the Board spent £80k on legal costs and £100k on due diligence costs and £700k to acquire GGL when it had negative net assets of £425k so a liabliity as it was sold at a loss of between £725k to £875k depending upon whether the £150k of contingent consideration is received or not.
If you look at the 2023 AGM presentation dated 9 August 2023 you will see a slide titled:
Strategic progress made through 2022 and H1 2023
Strong operational and financial performance of EAG JV in parallel with identifying follow-on investment opportunities
There is also slide titled:
Demonstrating Scirocco’s robust investment model -EAG
There is also a slide titled
Investment Structure & Waterfall –a path to sustainable capital growth
This information demonstrates how the EAG/GGL business model is going to produce substantial capital returns for SCIR as the loan was to be repaid first and then SCIR would receive its capital profit share.
In period of just 4 months the Board decided that the excellent EAG/GGL investment opportunity was not such a good investment after all and that they should sell it as soon as possible at a loss of between £725k to £875k dependent upon whether the £150k of contingent consideration is received or not.
The presentation contains the normal disclaimers saying "The presentation has not been verified, does not purport to contain all the information that a prospective investor may require and is subject to updating etc etc.
The divestment document contains a number reasons as to why EAG/GGL was being sold at such a massive loss
The Board spent £100k on due diligence costs for the acquisition of EAG/GGL and it should have included the projected revenues and costs within the net present value cash flow table as well as an Internal rate of return calculation.
There should have been a sensitivity analysis to show what would happen if revenue and costs or interest rates were to change by certain amounts.
It was quite obvious even to the man on the clapham ominbus that interest rates would rise substantially after EAG/GGL was acquired!
AGE
Have the Board spent shareholders wisely and managed to obtain the best value for money that was available?
44RJ raised an excellent question in his post yesterday at 15:53 which is relevant to the point above.
"Why they didn't prioritise Ruvuma and preserve cash to stay in the game is totally beyond me"
SCIR shareholders bought their shares because of the potential upside on Ruvuma and as they had lost so much money on their original investment they were willing to take the chance that it would either come good in which case they might get back their original investment or even make a profit or if not successful then they would lose all of their investment.
The Board stated that they had a duty of care to shareholders and that Ruvuma was very risky and so they sought shareholders authority to sell Ruvuma and then reinvest the proceeds in the circular economy as is was the future and it was less risky.
In a period from the year ended 31 December 2018 to 31 December 2021 which is a period of just 4 years the Board paid £2.132m to Gneiss Energy Ltd for consultancy fees and the current market value of SCIR is £2.7m so those fees represents 78.92% of the current market value of SCIR.
During those 4 years SCIR received a net amount of £7.111m from issuing shares so the £2.132m represents 29.98% of the net proceeds.
Gneiss Energy Ltd was paid a success fee for negotiating the sale of Ruvuma however shareholders do not know how much they were paid as when the Board were asked about this at the AGM they replied that the payment fell within market norms.
If you look at the cumulative P&L account you will see that accountancy services fees amounted to £606k for just 5 years and the cost for 2022 was a whopping £152k
For £152k you could employ a qualified full time Financial Controller for more than a year and yet the accounting related services job is a part time job.
The part time job would involve the following:
Maintaining day to day accounting records
VAT returns
Payroll run for one employee and the Board
Payment of suppliers
Preparation of the interim and annual accounts
The cumulative cash flow shows that SCIR received revenue of just £1.457m and the turnover from GGL was not included in the consolidated P&L account of SCIR as only SCIR's share of EAG's profit/(loss) was included in the P&L.
The question has to be asked how did it cost so much for accounting related services for the following years when the accounting services role is just a part time job?
2022 £152,000
2021 £ 93,000
2020 £114,000
2019 £196,000
2018 £ 51,000
The Board spent £1,293,000 on the abortive One Dyas deal when it did not have a great deal of cash and how was SCIR going to able to raise the cash if the deal had of been successful?
I will leave you to judge if you think that the Board have spent shareholders money wisely and if they have obtained the best value for money