Member Info for chris_g

I was expecting a fall today on the back of the TU so pleasantly surprised that its recovered from its initial drop. I think that this is a good indicator that the shares have found a bottom and will hopefully recover from here assuming no major missteps. In the dim and distant past I remember reading somewhere (Graham or Buffet?) that "value" shares that not dropping on bad news is an indicator of consensus shifting and a decent buy signal.

Mr Picky. I guess that is possible but under takeover rules I believe they have to make a mandatory offer at the highest price paid in the last 12 months if they exceed a 30% holding, so the benefit of doing this is limited. I remain puzzled.

So much for rational investment managers eh? The logic of "your offer of 150p is not good enough but we aren't prepared to pay more for the business but still won't sell at 150p" is perplexing. The only strategy that remotely makes sense now is they wait for a year and then try to pick it up for a lowball price leveraging their 25% stake. At least I take comfort from the fact that they're now sitting on a paper loss of £6m from their recent buys at 147ish.

The Takeover Panel has set December 15th as the date by which DBAY has to either make an offer or confirm it will not be offering. Similarly CICOR have until the 15th to decide whether they want to increase their offer. It could be an interesting few days.

It makes more sense now. It comes as no surprise that DBAY will vote against the CICOR offer but the news that they are undertaking DD as part of evaluating making an offer themselves is interesting and explains why they were prepared to pay approximately 147p or share to acquire their blocking position. Describing the CICOR offer as unattractive at 150p share, and having paid 147 for their most recent stakebuilding, means that IF a DBAY offer does materialise the it has to be meaningfully north of 150p. DBAY must also think TTG is an attractive business going down this route and were clearly low balling when offering in the mid 130's previously. Expect some share price volatility in the next few days until things become clearer. It might be worth taking some profits on any share price strength to hedge the risk of no offer materialising.

I don't get DBAYs actions though. They've just spent £20m at approximately 147p per share to acquire a blocking stake. How do they ultimately make money from this, unless a higher bid materialises or through a long slog. A low ball subsequent offer is made more difficult by the fact they clearly view 150p as undervalued, and that they've acquired shares at 147p. Why not just take the profit on your existing stake?

I suspect that tariff concerns are a major factor in the recent share price falls. I can see 2 sources of tariff risk:-

1) Product manufactured in the US that might currently be exported to elsewhere in the Americas (Canada, Mexico etc) that could be subject to retaliatory tariffs from those countries;

2) Product imported to the US, especially from China. Although they have manufacturing in the US I suspect they also import product from China due to low cost advantage, product speciality issues. The annual report states "Our Chinese chain plant primarily serves sister companies with a range of transmission chains" which would suggest lots of product is exported.

It might remain a rocky ride for a while until Trump's actions, rather than his words, can be seen.

No confidence in this board, appear arrogant and out of touch for refusing to engage with offers at double yesterday's closing price and then deliver more cold gruel to shareholders this morning. I note the reference to a prior year adjustment in this morning's RNS. Hopefully they will claw back elements of last year's bonuses and LTIP awards. Completely unacceptable if they don't.

And there she blows, deal confirmed.

I don't really understand the delay in issuing an RNS given the deadline is today.

If a further extension is needed then a simple update at 7am wouldn't seem too difficult to organise. If the deal is off, this should be communicated promptly once that is clear, which I assume would have happened by now. So I assume the deal is on with an announcement later today, but why the delay?

Not sure whether this deal will make it through. The AXL share price dropped 10% yesterday after the announcement which means the offer is now c5% below the announced value to shareholders.

It is also significant that no institutional shareholders have given irrevocable undertakings to sell their shares at the offer price. Normally when a deal is announced the buyer has usually spoken to some of the major shareholders to get them to give such an undertaking, which gives a signal to the market, and the buyer greater confidence, that the deal will go through. The only irrevocable undertakings announced appear to be from DWL management. This is a little strange. It increases the likelihood of major shareholders being unhappy with the price and therefore voting against the deal.

The share price movement yesterday, with it closing up only 8% and well below the offer price also suggests this is far from a done deal.

Aaah, just seen why now. Bloomberg are carrying a report that Macquarie are working with advisers and planning to submit another bid.

20% spike this morning must mean a new bid. No RNS yet but the leaky City strikes again.

Or maybe news leaking of a rights issue / fundraise?. The hamfisted way they communicated their efforts to seek additional finance for growth has been a big factor in the uncertainty that has seen WJG plummet further and if they do any sort of equity fundraise at these levels the whole board needs to go.

Not so sure it counts as new blood though PJT12 as he's been on the board since January 21 as a NED. I'm not convinced his Apple experience and branding focus is what the company needs right now (more of the same?) . Hope he appoints a strong COO to get a grip of things.

The Board still can't quite seem to recognise the reality of the situation.

They still seem obsessed with resourcing a long term growth plan when the business is clearly in need of rightsizing to the realistic medium term position. A £35m hit from inflation next year including "retaining and incentivising talent throughout the organisation" - that'll be the talent that has seen the business mismanaged to its current state I assume. And I hate the weasily "where possible" added to the statement on cost savings - sounds like they are really not committed to it. And why does it take 18 months or so of sitting on an Everest sized pile of inventory to only now start significantly scaling back orders in the supply chain?

Having said that I've topped up this morning on a view (hope?) that the business will be in better shape in 3 years time and the valuation at these levels appears to offer significant upside if that does materialise. The CEO change is essential but I would have preferred a more rounded individual with growth and rightsizing experience rather than an ex Apple manager. The RNS has a feel of a kitchen sinking exercise to prepare the ground for the new CEO (why else talk about a worst case for 2025?) but we'll see. Hopefully this is the last of the warnings and they've now cratered expectations so low that they should be able to get close to them in 2025. Maybe this is the point of capitulation? They must be in play now given this morning's price fall so that should also underpin the price?

Given the Red Sea issues, maybe having too much inventory isn't quite such a bad thing at the moment?

Possibly.

Trading will stabilise but I see issues with inventory (nearly a year's worth now on hand) and whether the growth cost "investment" proves to be overdone for the reality of the business.

Having said that, finally bought in this morning on a 3 year view that things should be looking healthier by then and the shares up from where they are now. Unlikely to be a smooth ride though.

I've been in here for 8 years and thankfully I'd taken profits on most of my holding in TSTL at higher levels, so no longer a significant holding but I'm more than a little hacked off by the poor market communication on the issues and decisions made by management. And the share based remuneration scheme is a joke. How can it align the management with interests of shareholders when the SBP charge equates to 40% of pre SBP operating profit in these results. Not a good optic and suggests that the Board need to take a hard look at this. As this is not a big holding I'm inclined to just sit on it and see what happens in the US but the distaste of SBP might push me over the edge.

I agree, but am a little bemused by the share price movement this morning. To me the results look like they came in at least in line with the post year end trading update and there didn't seem to be any overt negatives in the outlook. Yet the shares are down 15% at the moment. So much for efficient markets??