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As this looks like a done deal I'm continuing to move over to TAP. The two 10k trades at 8am this morning were sells not buys, there's another from 9.20 not yet reported. You'll see the corresponding buys over on TAP.
Got 26,586 TAP for my 30,000 R1 so 1,131 more TAP than if I'd waited for the deal to go through. Have now 'gained' an extra 4,000 shares from switching so far.
No doubt there will be more opportunities to come of the spread widening enough to make it worthwhile.
Indeed. I'm in town on those days so will try and get to both. Hopefully they'll do a bit of Q&A rather than just vote the deal through which seems a foregone conclusion.
Going to have to sell all my TAP shares, just noticed they aren't in the top 30 on Ads.txt, clearly not a viable business. Surely that should have been in the Shareholder Circular too?
Given the supposed cash generation I'd be disappointed if they halve it. I think there is the possibility of some form of special dividend given the individual businesses were going to buy back $20m.
On a separate note, has anyone seen the venue of the EGM for R1. Their RNS said 10.15 on 22nd March but I couldn't see an address - could just be me being super thick though.
Tardis, will be interesting to see what they do on dividend with Tap’s 29 Mar results too. That will be another new feeling for R1 holders.
Well I've had a quick shifty through the circular on the TAP website. Reassurance on the profit outlook is encouraging. I couldn't help thinking there were two glaring mistakes:
Assumptions outside their control: that GDPR wouldn't decimate the global digital advertising ecosystem and force advertisers to rely on leaflet drops into target communities before March 2019
Assumptions within their control: there will be no skeletons to come out on their crazy past initiatives/acquisitions
If they've missed those two what else might they be hiding? Not sure I can rely on that document.
I'll just have to go to the EGM and ask them!!
1GW, the only note I had was from Whitman Howard on 13th Dec. They had revenues at $400m for the year, adj ebitda at $55m and EPS at 38.8p.
Wouldn’t surprise me if they took the first opportunity to impair a chunk of the R1 goodwill to help boost the PBT numbers. This could help re-rate the share price as everyone has some concerns over protracted use of EBITDA.
1GW, i’d Assumed they didn’t want to quote effectively numbers from a quarter end trading update which they seem not to want to give while in take over node. The end November would be ok as the $31m from the results call was already in the public domain. Surely it was legal advice based as it would make much more sense to both quote cash from the same date.
The R1 cash of $18.2m at end November was lower than I expected. On 13th Dec Mark Bonney was quoting $31m as cash balance at end of previous week. I assume they aren't like for like measures then? Don't see why they didn't use the same reference point for both companies.
From what I've seen TAP share price decline was partly down to revenue softness, not just CEO. R1 had the same problem. So this deal is really all about the synergies and they didn't put in an indicative value in the RNS which is bizarre.
Let's hope the presentation has more detail, specifically including synergies. Latest trading to end Dec would also be good.
At least TAP share price responding a bit this morning now.
key now is what the level of synergies are forecast to be. Surely they are in the £20-30m area if Yume was $15m. Should be highly complimentary operations.
It won't happen now Dw.
Yes WG but as it is all paper then the number of shares in the combined business will still be the same, they'll just be worth more. Obviously on the TAP shares I've bought the value of those will go up so I don't lose anything, just lock in the 'extra' shares. Of course if it doesn't go through I'll lose!
ripley, TAP announced the intended 16 TAP shares for every 19 R1 shares. Also stated that if R1 paid out a dividend they could restructure the deal to account for that.
Looks like the value in selling R1 and buying Tap closed quite a bit. I've off loaded 30,500 R1 shares this morning and bought 28,868 TAP. Time will tell if this was sensible but under the 19 for 16 deal I would have got 25,684 TAP shares for the 30,500. Looks good on paper unless there is another party that comes in or the structure changes. It feels like this is quite advanced though.
Indeed beatroot, so if you think it is going through on the terms released this morning are you not better to sell rthm and buy tap. Almost 1:1 earlier rather than 19:16
So that values each R1 share at 1.40?
Ok, I’m struggling s bit on squaring this move. If TAP are going to be the majority holder on paper don’t they need to give us around £40m in cash to deal with the market cap imbalance? TAP had been consistently talking about an acquisition so that would normally mean a premium for the target but that is far from clear too. Of course if 3 major shareholders say yes it’s a done deal anyway but no idea what this does for the valuation of R1.
Looks like it’s started 50 shares at a time scheduled to complete by 2022
I'm hoping details announced with the TU (assuming we get one in the next week or so) and they start buying the following day. Share your concerns re acquisition activity wagas.