Undervalued massively!!6 Jul 2018 14:03
(part 1)
There is seriously something not adding up here and I mean that in the positive! I am that convinced that the majority are chasing rainbows and not seen a couple of things which are glaringly obvious. This is so obvious that I have moved out of another brilliant holding into here as its ‘free money’ I am satisfied with what I got! But if it dropped any further I am waiting in ambush. This has been blatantly held at an artificial low price, trades placed just as things beginning to move to keep price down . We are 1p and the bond holders were offered 15p. OK 15p may look a way off and agreed to a long time ago, but if you are a bond holder be honest and you are FG you might want to meet a ‘mutual level’ which is acceptable to all? So what will it take to get to that ‘mutual level’ ?
As if by magic…….keep watching this space! Steve888 with all respect mate you proved to me at 16.32hrs on the day of the results a lot of people like you may not have understood immediately what was been said. I am so pleased though you have stuck by it, and you will get rewarded.
Please please please go over this post again and read it again from RKB.
Zero Rate Convertible Bonds
When I first invested in Clear Leisure a couple of years ago I was intrigued about the Zero Rate Convertible Bonds 2015.
We now know from the Bond Holders Meeting of 19/06/18 that the Maturity Date of the Bonds has been moved to 15/12/22.
You need to understand the history behind the Bonds and subsequent events to realise the significance of moving the maturity date to 2022.
On 31/12/15 FG managed to reduce the interest rate from 9.5% to 7% and to a new Maturity Date of 15/12/17.
On 30/12/16 FG managed to reduce the interest rate from 7% to 1% and to a new Maturity Date of 15/12/18.
We also know from recent Bondholders Meeting and the recent Annual Results for 2017 that the Bonds including interest up to the December 2022 date would be about €7.4 million.
In all the Annual Results and on the 2017 Annual Results (page 44 note 31) it says that the Bonds are convertible at 15p.
Clear Leisure has not had the funds to repay the Bonds in cash and at the maturity date in 2015 or 2017 or 2018 in 2022 Clear Leisure can exercise their right to convert the Bonds at 15p.
In my 2017 Results Part 6 I calculated the €7.4 million maturity value at December 2022 with the € and £ at parity and if converted at 1p then it would cost us nominal capital of £1,850,000 but if FG were to force the Bond Holders to convert at 15p it would only result in less than 50 million shares being issued (49,333,333 x 15p = £7.4 million) and the nominal capital that would be required is only £123,333 (49,333,333 X 0.25p = £123K)
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