The latest Investing Matters Podcast with Jean Roche, Co-Manager of Schroder UK Mid Cap Investment Trust has just been released. Listen here.
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I hold a considerable size (relative to my total portfolio) of SKIN but hold no shares in MWG.
Obviously the 2 are linked closely but what I don't understand is whether it's kind of compulsory to hold both for making sure if something big does happen, I don't lose out because it is mwg and not skin.
Do you all hold both?
Yes don't forget mcap of mwg is much lower
Just so I understand, everything that Gérard is talking about in this board and his tweets etc, is he (are you) talking solely about skin or is skin and mwg effectly one company?
They’re very much two PLCs, GB is the CEO here and non-exec chairman there so is a lot more hands on here although is clearly influencing strategy there.
Two amazing PLCs with super technology that’s gold standard and combining them re real-time monitoring will be another game changer and disrupt the market. My understanding is that SKIN AI will be bolted on to MWG’s monitoring kit so an immediate route to their existing clients and I imagine demand will be massive for new clients.
I think GB was tweeting about SKIN but it could well be linked with MWG. An interesting week ahead surely.
Agree with Retireby40 but would add my thoughts on the choosing of how to weight any investment:-
As stated above , MWG has a significantly lower market cap by around 50%
At the moment, we really do not have anything concrete to sink our teeth into. As it stands, we do not have a product that can detect Pathogens in waste water in real time which is why the SP is volatile but not seeing any real gains. We do expect to have such a product at or I am assuming close to the completion of the works being done up at Aberdeen University. I would imagine that an RNS would be released at this point and at this time you would see a significant re rate in SP and possibly Media coverage.
For my part, I am assuming that the product will come to successful fruition and will be desirable to multiple clients. Much of this belief is based on GB's credentials, not least in which he took a company called Altracel from 0 to £50m before selling it.
As to future valuations between SKIN and MWG, therein lies the question as there is quite a bit for me that is not clear.
a) It will be MWG kit that is sold and hence I assume that all profit from this will go to MWG. That said, SKIN will be bolting on it's AI which would otherwise make MWG's microtox servers somewhat irrelevant. We do not know what the revenue share split for this would be. We do know that the consumable recurring reagent revenue share is 60/40 in MWG's favour.
b) It is apparent that should all go ahead according to plan, this could be a blue sky scenario where demand could be huge. Unfortunately, we also know that neither company has much cash in the bank and for a project of this size and scale, significant cash injection will be necessary. Where this cash will come from is unknown at present. If governments and large businesses are interested then grants/low interest loans may be available. Outside that we may me looking at another placing and subsequent dilution of shares. Taking this path though at today's Market cap and share price I doubt we would be able to raise enough if we are talking about global production taking into account all the extra infrastructure and staff that would be needed.
There is also a very real possibility in my opinion that once everything is in place the companies may be merged and sold off to a larger player with far greater working capital available.
Hopefully GB has a plan :- ))))
Thanks all.
Chrysalis1, I also think that they will merge together if this detection is successful.
As much as I like integumen and the other products/tech its working on, I do worry that it could be mwg that could be the company to benefit the most from this.
I also didn't realise mwg had a much lower MC as obviously their share price is very similar to skin.
Chrysalis have a look at GBs most recent tweets about OEM collaboration partners. No new cash needed if someone else has the factory, you don't have to build one.
Adds another angle to the profit distribution, but if they can meet the demand, blue sky it is for all concerned.
Hi Argylerich,
I've seen that, but collaboration only goes so far. Just the simple stuff like manufacturing reagents for world consumption, I can't see as being done from a medium size lab out of York, let alone increased staff costs to do it all. I hope I am wrong and I will be the first to admit that I am no businessman and certainly I will take my hat off to GB if extra cash is not needed somewhere along the line upon disclosure of a successful outcome in Aberdeen.
ATB
I believe you all have the right angles, share price may get up on good new, then dependant on GB plans share price will come down a little or more than we want, however may pick up momentum if GB has covered all the pockets, blue sky could be, I do hope we start to see greater improvements especially with news feed so other companies say “Hey I’ll have some of that”. I to split my share holding to both SKIN & MWG for on a 60/40 basis in favour of SKIN. If all good both companies should fast be become the brand names in the fight against anything and somewhat any application. I really hope we fully exploit our credentials on every media stream. Nice work so far GB let’s just get out of Limbo Land:-)
The revenue share for the water projects is 60% MWG 40% SKIN. SKIN has more going on income wise with other projects but as others have said, MWG has a lower market cap. Both great investments for the future in my mind.
Hi Chrysalis, the collaboration isn't just for the labwork as in between MWG and SKIN. There is going to be demand for thousands (hopefully) of devices (with different size & shapes for different placements) and these need to be manufactured. Neither company has the time or money to set up its own factory and the current outsource manufacturer for MWG would need to step up a large gear to cope. This is the last link missing in order to get the devices to market as soon as the aptamers (and other possible methods) are proven with the live virus.
Weather geek, the 60/40 agreement is purely for the manufacture of reagents, nothing else.