Member Info for Adyan9200

Current OPTI Valuation: ~£26M (and majority of that value is from SBTX), so if we exclude SBTX and cash, receivables etc rest of OPTI is probably only valued at£7m at moment, which is massively undervalued.
New Company Probiotix Health: £22.5m
New shareholders will get ~£2.5m of new company
Existing OPTI Shareholders will get: 35% - 37%
OPTI will keep 46% - 48%
And new shareholders around 13% - 18%

So if we say new share-holders get 15%, that means as a current OPTI share-holder we will retain 85% of shares:
37% we will get directly in shares (with lock-in period etc)
48% will still be owed by Opti.

So, you will still own 85% of the company either via the in-specie div or by your stake in OPTI, and if the new company hold’s it’s valuation in future, we would own about ~£19m of new company.
So what is currently worth around £3m within opti (if we exclude value of SBTX, and other divisions in OPTI, you may value it differently though), by separating out Probiotix Health, we’ve increased value by £16m, so 6x what the market is currently valuing it at.
Please note, these figures are rough estimates and someone with more knowledge will be able to give better info.
I must say, I do much more prefer the way this is being split compared to how SBTX was done, as it ensures existing OPTI shareholders get shares in Probiotix Health directly (so you don’t need to buy separately if you don’t want), and OPTI still down a big chuck also. I really wished they had done that with SBTX as well.

https://www.yorkshirepost.co.uk/business/this-is-how-the-yorkshire-life-sciences-business-optibiotix-health-is-set-to-save-lives-of-people-with-high-cholesterol-3531340

Thanks Elrico.

Some very reassuring things in the interview, Sweetbiotix has always been the one with the greatest potential for the largest revenue, and good to hear Stephen talking about the potential revenue Slimbiome, LP-LDL and Sweetbiotix could reach in the next few years. Just going by the low end (10 + 10 + 100) 120 million revenue would be awesome, I assume when Stephen says Revenue, it's referring to the Royalty/profit share aspects in which case majority of that would be pure profit as our expenses would be limited (even if we allowed 10-20% for additional expenses above the current fixed costs, the profit will be enormous).

Therefore my initial aims for buying the shares in Opti originally (the potential for dividends) will be realized hopefully. I had expected things to move a lot quicker, and been disappointed with the speed, but these things do take time and I need to be patient, as nothings changed with the underlining pinning of the business.

I'm a LTH (I see this share as an excellent income generator via Div in long term), and am a little disappointed with the results, but if we take into consideration the Covid situation, and partners delaying product launches etc, then it's still good.

I do feel a bit misled regarding the SBTX, as originally the plan was to give existing OPTI shareholders direct shares into SBTX and SOH was looking at how that could be done. Based on that information, I decided not to buy SBTX shares directly and instead pump more into OPTI. I know other holders did buy SBTX instead of more OPTI and are glad they did. And my indirect holding in SBTX via OPTI has decreased as OTPI have part of the SBTX holding they had.

Therefore the mention that SOH is thinking of splitting the different divisions and floating them along the lines of SBTX, is making me a little nervous. I could understand the rational for doing it with Skin, as that wasn't a core part of OPTI originally and it needed a lot of capital to move forward, therefore without diluting OPTI, floating SBTX made sense. But the other divisions have been a core part of OPTI, and because I'm looking at the share as a good divi generator, floating them as he did with SBTX, I don't see it benefitting me.

What do others make of this?

Does anyone know how existing shareholders in Optibiotix will benefit by an ProBiotix IPO.

I'm just trying to get my head around how as shareholders in OPTI we currently own 100%, but doing an IPO for ProBiotix would decrease that percentage, and in effect have a diluting effect wouldn't it even though we don't need to raise funds. Sorry if it's a silly question.

I understand why we did it for SBTX as we needed funds to take it forward and it wasn't part of the original core part of OPTI.

Thanks porthleven and Elrico for your views.

I definitely plan to keep my main OPTI holding, esp as that has been de-risked and is in the commercial stage. I guess the best balance is to continue to keep the majority of my holding in OPTI and buy small holdings in SBTX and any other spin-offs they do in future.

I'm still not sure how spinning off say Sweetbiotix, LP-LDL etc would benefit me, as those platforms don't require additional funds (which was the purpose for SBTX) and are already in/entering the commercial phase and I can see them being very profitable, therefore wouldn't it be better to keep the whole Sweetbiotix etc within OPTI, and us benefiting from dividends from the profit they provide? Spinning off would give away say 60% (if we follow SBTX example) and therefore we would only benefit on the 40% that OPTI own (unless the plan is to pass the money raised on the 60% directly to the OPTI share-holders via a special divi).

I know Stephen O’Hara aim is to maximise the value to share-holders, but just trying to understand how spinning out different components would benefit the share holder in OPTI.

Thanks Elrico, some interesting stuff.

I'm in this for the very long term, the sheer potential of all the component parts gives me plenty of confidence and can see the potential for excellent dividends in future, so it's definitely one to hold (maybe forever).

My only concern/worry is the splitting of each part into separate companies as done to SKIN. I can fully understand why SBTX was setup as it required a lot of cash to develop and take it forward, especially as it wasn't part of the original OPTI pipeline (and was an excellent opportunity which OPTI took straight away). I originally thought of buying some SBTX shares a little after it was floated, but decided against it as I thought I was already very heavily invested in OPTI and should benefit from the in-specie.

My question is, do you think we should buy shares in SBTX and any other companies OPTI spins off, or do you think we're better off buying more of OPTI instead?

This is definitely a long term hold, IMO it will still take some time, so it's definitely not for anyone wanting to make a quick buck. I personally have an average of 69p, and my plan is to keep this very long term as I do believe the dividend potential here is going to be great. I think once 1-2 deal revenues start pouring in, others will follow quickly close behind. Yes, most of us are a little disappointed with the share price performance, esp those of us who have brought in last 2 years when price was higher. But as long as you did your research when you brought and have continued to follow the progress, then there's nothing to worry about as the business is building up nicely.

Yesterday, I can see 3 brokers updated their forecasts. FinnCap - Buy - 120p Target RBC Capital Markets - Outperform - 140p Target JP Morgan Cazenove - Overweight - 140p Target It is really disappointing to see politics in SA and Tanzania, which is only going to negatively effect their own economies, and unfortunately it's the main reason for the low share price here, otherwise I would have expected it to be around 140p. The question now is, how long will the Tanzania issue take to resolve and will the SA Govt come to it's senses regarding the new mining charter.

Yep, Some good news in the RNS about "Amendment to Covenant Measurement", so at least we know that is now sorted.

We should get the preliminary results for the year ended 30 June 2017 on 18 September. I'm hoping they'll have more info on the talks with the banks.

It could be to do with https://en.m.wikipedia.org/wiki/Kenges_Rakishev who holds 19% of CAML. He could be wanting to reverse some privately held interests into CAML or such. Again this is just speculation.

WTH, that is very very annoying. We were going along so well, and results were due out next Monday.

Thanks Elrico. Interesting info about the different formulations and how it's being adapted for different countries . Really looking forward to the progress this company will be making in the coming years, definitely a very long term hold for me. I've got very high confidence in him, and he's definitely on the ball on the business side of things and ensuring he maximizes the value in every deal. As for those impatient about the amount of time taking to get deals done, as far as I'm concerned it's only been a few months since we've moved to the commercialization phase, and anyway with a bit of business knowledge will know that deals take time to do, especially with big companies.

Yep, I haven't seen the 25K seller for the last few trading days. So I'm hopeful s/he's finally finished, which has meant it's allowed the SP to move upwards.

I'm expecting them to release around 11 September.

I agree, putting it in dairy products will have the most potential, so am looking forward to that progressing.

Same here, wanted to top up yesterday when it was around 56, but missed the boat (was waiting to sell some other shares).

Yep, and if they are liquidating their whole holding, their 25K batch selling is going to keep the SP down for quite a few more months sadly. I'm expecting the H1 results to be out around 11 September, and with the copper price having increase from since last update, hopefully should help give a boost to the SP.

I wonder if "South African MPs will vote in secret on a motion of no-confidence in President Jacob Zuma on Tuesday" might be having a positive effect.