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Odd isn't it Matt, not received any paperwork either and No corporate action showing in my trading account despite knowing it's happening next week!
Hi All, I was looking to vote next week and note I haven't received papers. I've had this issue previously with SCIR, and my broker advised it was because the BOD designated it a 'shareholders meeting' rather than an AGM or EGM.
No problem, the circular says you can vote online via shareregistrars. Except you need an account setup, and you can't do that online yourself - you have to contact them to request an account be set up.
Are the BOD making this deliberately hard, especially with the publication over Christmas?
Or desperate....
Someone is brave
Indeed. But the BOD bought Greenan after expensive due diligence, so either that DD was rubbish, or it's a lie. You could sell EAG, and still have the £1.5m loan on the books.
EBITDA a popular quoted metric created to try and deceive shareholders into believing that a company is doing well when the reality is that it is not!
Any fool can sell products at a loss the key to being a successful company is that it needs to make a profit after deducting all of the costs of running it irrespective of whether they are cash costs or not!
AGE
Greenan is EBITDA positive. TR stated that profits would be kept in EAG for reinvestment. So, according to the model, EAG should be self-funding.
Thinking about this again it is perhaps not appropriate to use an linear method of calculation as the additional £2.5m investment for the Bio Fertlilser add on enables the AD plant to provide a higher incremental rate of return!
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Highlandmatt in that case if we use £9m then £9m less £2..5m is £6.5m which is 2.5 times GT's valuation of enterprise value ?
AGE
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I think the £9-10m refers to having the Bio Fertiliser add-on, which costs £2.5m to build. But having stated this to be a profitable solution, that the investments are suitable for bank loans, and received $2.5m from Ruvuma, why hasn't this investment been made if the ROI is so good? It just doesn't add up
Highlandmatt in that case if we use £9m then £9m less £2..5m is £6.5m which is 2.5 times GT's valuation of enterprise value ?
AGE
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I think the £9-10m refers to having the Bio Fertiliser add-on, which costs £2.5m to build. But having stated this to be a profitable solution, that the investments are suitable for bank loans, and received $2.5m from Ruvuma, why hasn't this investment been made if the ROI is so good? It just doesn't add up
In case it is not clear in my previous post the Board have used Grant Thornton LLP NI to produce an independent report to justify selling EAG at an enterprise value of £2.6m yet the Board produced slides for the Annual General Meeting on 9 August 2023 that show an enterprise value of 5m.
The question has to be asked is why did the Board state that the AD plant has a Enterprise Value of £5m when they sought permission from shareholders to issue more shares yet now when they want us to approve the sale they state it is £2.6m and yet the Bank of England base rate has not changed in between the 9 August 2023 and 21 December 2023?
They state their reasons for selling at a massive loss as:
"Rising interest rates: the value of capital assets has decreased across multiple sectors as interest rates have increased since early 2022. As the risk-free rate available to investors increases, the expected or target return on fixed assets increases, reducing the price investors will pay for a series of cashflows. When the Company invested in EAG in order to acquire Greenan Generation Limited (“Greenan”), UK interest rates were 0.25% whilst the Bank of England base rate is currently 5.25%."
The above statement re interest rates increasing is factually correct however the AGM presentation was based upon a base rate of 5.25% and not 0.5% and it showed a sales enterprise value of £5m and not £2.6m?
Before making the decision to go ahead with the investment into EAG and providing the £1.2m to acquire GGL they would had a report produced that shows the amount of the investment/loan together with the expected cash flows generated by GGL and they would have discounted the future cash flows (DCF) using an appropriate discount rate and they would also have produced an Internal Rate of Return (IRR).
They would not have used the Bank of England base rate of 0.5% as the discount rate but rather 10% .
AGE
I think the £9-10m refers to having the Bio Fertiliser add-on, which costs £2.5m to build. But having stated this to be a profitable solution, that the investments are suitable for bank loans, and received $2.5m from Ruvuma, why hasn't this investment been made if the ROI is so good? It just doesn't add up.
The Board produced a presentation for the Annual General Meeting dated 9 August 2023 and one of the slides contains the following:
"The optimum combination should be considered as a 0.5 MWe AD plant and associated BF plant requiring £2.5m of equity and delivering estimated enterprise value in the £9m-£10m range"
In the sales document they state:
They state the following:
"The market for a single 0.5MW AD plant is limited with a limited pool of potential local buyers, with investors typically seeking larger plants or managed portfolios of multiple installations." yet the optimum combination is 0.5Mwe AD plants!.
The example on the AGM slides shows Sales Enterprise Value of £5m so it appears as if the wording above of £9m-£10m is not correct as it must relates to two or maybe three AD plants rather than one.
The example shows Total loan balance on 31 December 2022 of £1.345m and
Sales Enterprise Value 5.0m
Corporate debt 1.8m
Net equity for distribution 3.2m
The Sales Enterprise Value of £5m has dropped to just £2.6m per the deal and yet interest rates have not changed in between 3 August 2023 and the date of the sales document which is dated 21 December 2023.
The Bank of England increased the base rate to 5.25% on 3 August 2023 and it is currently 5.25% and the presentation was dated 9 August 2023.
Just 5 months later and the Board have taken a complete U turn and they have produced a document giving a detailed explanation as to why shareholders should approve the sale and make a loss of 53.86% on the total loan of £1,578,000
AGE
Notice of a General Meeting of the Company, to be held at the offices of Pinsent Masons
LLP at 141 Bothwell Street, Glasgow, G2 7EQ at 10.30am on 10 January 2024 is set out in
Part II of this document.
The Board is holding the General Meeting in Glasgow rather than London where they have held previous AGM's & GM's thereby making it more difficult for shareholders to attend should they wish to do so.
AGE
Could be six months until suspension and then six months later delisting.
Crusty, fwiw I've invested in a whole gaggle of turkeys myself (this, DDDD, HAWK, FDI, VOG, CTT, HEIQ, TRP) but fortunately found a couple of diamonds that have kept my head above water. Moral of the story seems to be - don't follow Crusty/Krusty when planning an investment! Best of luck to all invested here & elsewhere. K
The SCIR shareholders haircut is even larger than I stated in my earlier post as the loan to EAG is £1,522,000 and they are paying back just £702,267 so a haircut of £819,733 or 53.86%.
We therefore will never receive any of the interest that accrued on the loan from SCIR (UK) Ltd to EAG and will lose £819,733 of the money we lent to EAG Ltd.
As Ollie of Laurel and Hardy used to say "This is fine mess you've gotten us into!"
AGE
Crusty- I would be cautious of this BOD. The company needs to be delisted and costs cut substantially to ensure that Ruvuma funds are distributed to SHs. This is obviously not in the BODs interests.
I would be looking for some guarantees before allowing them to sell your assets.
Mr arrow
happy new year m8,i know u dont like xmas,so i'll leave that bit for intepretation.lo,
There is some interesting information on Companies House that shows that EAG Ltd and GGL have registered charges for loans from AIB Group (UK) PLC dated 18 July 2023.
AIB Group (UK) PLC carry out in-depth due diligence before lending money to EAG/GGL so if they thought EAG's and GGL's prospects are not good then why would they lend them the money?
Per the document produced by the SCIR Board:
"The receipt of a waiver by Allied Irish Banks PLC, as EAG’s primary lender, of any change of control provisions, or equivalent mechanisms, which may apply to the Proposed Transaction under the existing loan facility dated 3 May 2023 made between EAG and AIB "
The AIB loan facility is dated 3 May 2023 so just over 8 months ago.
If you look at the charge registered by EAG Ltd with the reference NI6650020002, you can see schedule 1 "assigned contracts" which include a number of feedstock contracts with Ludlow Bio Ltd dated 12 November 2020.
How is it that GGL is able to assign contracts between Ludlow Bio Ltd and other third parties?
AGE
The Aim ruling 5.6 that is referred to state's that where a company disposes of all it's assets ( that would virtually be the situation here) they have 12 months from that date to start new investments
Failing to do so would lead to suspension.
There is a difference between "will" or "may".......personally I think "will not".........the BOD will probably take years to identify a RBO...and still draw salaries to boot!
"At this point, the Board intends to finalise its review of a range of potential alternative options available to it by which it is able to deliver value to Shareholders, which may include the distribution of available cash, further investments in line with its investing policy and/or the deployment of the proceeds in pursuit of a reverse takeover transaction."
I lost £90 selling out of here ......but the "turkey" in me has bought back in.....but got an extra 52k shares for the same net investment.........cooking! lol.
Speaking of Turkeys, I certainly have invested in a few!! Unfortunately many have cost me an awful lot of money (NUOG, DDDD and most recently He1) but honestly I have never seen a Board that have so egregiously and blatantly fleeced a company of shareholder value more than this mob. Thankfully this is one BoD that I saw through early on and managed to leave before I lost my shirt here too....
This last episode is simply shameful - whilst I recognise the logic of AGE's post below I do have to say that, if by voting for this proposal it ultimately means that the Ruvuma proceeds can and will be returned to shareholders then surely that is the only way to go. To bring this extended debacle to a close. If not, then you only perpetuate the continued fleecing of shareholders by the current BoD?
Per the document produced by the Board:
When EAG acquired Greenan, the underlying NIROCs had 13 years
remaining. There is now 11 years remaining due to the passage of time. As a result, and due to
the absence of significant investment to grow revenue due to the lack of capital availability, the
value of the plant has reduced proportionally to the remaining NIROC profile.
2/13 x 100 is 15.38% so 84.61% of the life of the NIROC period remaining so plenty of time left.
AGE
The Board of SCIR/EAG must take SCIR shareholders for fools!
Voting in favour of the deal would be similar to Turkeys looking forward to Christmas!
2 Years ago the Board of SCIR convinced shareholders to vote for a major change of strategy having used their many years of combined experience as they had identified a new sector to invest money into.
They arranged the deal so that SCIR would loan the £1.2m to SCIR (UK) Ltd who would then loan it to EAG Ltd to buy shares in GGL a highly indebted company with negative net assets.
No interest was paid on the loan it just accrued in the books as an accounting entry and no part of the loan was repaid.
The amount payable to the sellers is £3 plus an amount of £702,267 in respect of the money that EAG owes to SCIR (UK) Ltd which is £1,270.000 so SCIR shareholders are taking a hair cut of £567,733 or 44.70% of the loan.
It is a sad indictment on the Board that in just a period of 2 years they have come to the conclusion that their decision
to loan money to EAG to invest in GGL was not such a good idea after all yet the IRR calculations were not based on a 2 year period but more like 20 years
I will be voting against the deal and all you turkeys who want to vote for the deal know what happens to Turkeys at Christmas.
AGE
Well it's easy to give a 1.5mil handout when it is someone else money. Ie ours