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Well I think this is a really good deal going through the details - looks as though a few others are of the same belief 900k buy just worked through. Helium One has also started with its drill.......that should translate to a bit of excitement here - that was a good investment by the Scir board
Thanks Aimster, I try. I've had a look at the Greenan Generation filings at Companies House. No P&L, but the debt on the balance sheet is coming down year on year, and the asset is ascribed a value of £1.7m. with £1.9m debt, if they were paying 10%, then that's £190k of their EBIT gone. Part of the deal is paying off £300k of the debt, so there is a return there. I think the value is not in Greenan per se, but owning 50% of EAG.
Not read through in detail yet, but hey they've done something at last.
Let's hope we all benefit and they continue to report good news second half of the year.
Just logged in and I see six oblong green boxes this morning,
That's enough to tell me it's a good deal.
At last a positive spin. I can’t be bothered to look at the details of this transaction this morning , but I know that Highlandmatt does, and he always posts non-biased knowledgable information.
I'm also happy. Firstly, the BOD are actually doing something. Secondly, SCIR is loaning funds to EAG at 10%, so there is a return there. Thirdly, we appear to be getting a good deal (700k to buy a company with EBIT of 450k, and EV of £2.6m). Of course there will be transaction costs - you can't buy anything without legal fees.
I'm happy with this. Its the right size of investment in a robust and proven technology. AD projects are small by nature but it's a repeatable model, so the new JV can "kick the tyres" with this small acquisition and build a larger portfolio gradually as funds are made available from other sources. Whilst this won't make us rich overnight, it is the basis for sustained growth in accordance with the previously announced low carbon strategy.
Thumbs up from me.
Looking at the figures involved.
Seems little if any profit in the deal IMO.
Also there is asset backed debt of £1.9 million not sure on that.
Also transaction costs of £200,000.
Mav - there was cash in the bank 6 months ago.
Just looking at the deal....the BOD assumed cash flow of about 13% from these deals. So operating profit after tax maybe around 5%?
That obviously gets swallowed up by corporate overheads, fees etc.
If they are going to do this then it needs to be with cheap money and at huge scale.
Cash is the bank and HE1 drilling commencing with the 25% of Nytora in place. Expect APT to come in a take perhaps 75-100% of their holding. Investment into sustainable energy is also a thumbs up. £9m market cap very cheap - can see this move sharply upwards today.