The latest Investing Matters Podcast episode featuring financial educator and author Jared Dillian has been released. Listen here.
This is incoherent nonsense, but I'll prepare a rebuttal regardless.
I have a negative view here, to be honest. I hope PIs don't get burned, but I fear it might happen so I'm short. My view won't affect the share price, and neither will yours. We're just having a discussion to help each other understand.
Why should I not be here just because I'm not bullish?
Just checked Bloomberg – I think MA could've been the 2.5m share trade at 08:10:08 on March 29 and then potentially sold down a tiny bit of that during the day for a net 2,420,005 gain on the day. That would've been before the 10.29am RNS that effectively cancelled his EGM and therefore he could've wanted the shares to maximize his votes at his EGM to vote the plans down. Unbeknownst to him, the board were busy preparing him an ultimatum which was released at 10:29 on March 29 which then rendered this purchase pointless.
I'm sure some people have strong views that this couldn't possibly be the case, but it's just food for thought.
Genuine question, what makes you think it's better for him to wait?
Yeah rights issue above current market price is unusual, though not impossible
Nothing. Never seen them in any distressed situation in Europe. They must be tiny in terms of AUM
Auson, didn't want to over-complicate!
KRSS – yeah, if it had no debt..but it was built with debt so as a shareholder you can't claim any of that...The debtholders need to be paid
It still amazes me that people who invest in shares don't understand the difference between enterprise value and equity value. Let me clear it up for you.
Let's say you buy a £1m house with a mortgage for £900k. Let's also assume that shortly afterwards, a sewage plant is built next door, lowering the value of the house to £500k (but it still has a mortgage for £900k). If Mike Ashley comes along and offers me £100k for my garage, the proceeds would have to go to the bank to pay part of the mortgage, not to me as the owner. However, if he offers to buy out my equity (which is technically worth nothing or is "underwater") for £40k, he's really saying that the house is worth at least £940k to him (as he would have to immediately pay off the £900k loan right after paying me £40k). Can you see how those two things are completely different? The enterprise value is the value of the house. The equity value is the economic value of my ownership. After the value of the house drops, my equity value is effectively zero, but that doesn't mean that the house itself (debt-free) doesn't have value.
Looks like they sold their shares...
No I don’t mean ongoing costs. I mean one-off fees that will have been partly paid now, and partly upon completion. I’ll drop the point because no-ones really getting what I’m saying, but it’ll probably be £30-50m
Oh absolutely. However, your mortgage broker doesn’t need lawyers to write complex intercreditor agreements, security documents, many many mortgages, common terms agreements, etc. They also don’t need advisors in 3 places (so 3x fees) and don’t charge large issuance fees on making the loan.
It’s going to be a large one-off, but nothing out of the ordinary in a deal like this. Just worth noting is all
Themuir – it’s more like legal fees, issuance fees, advisor fees etc that will bite them in 2018/2019
Ouch. Usually is the case, but won’t affect future years. Money out the door, though...plus advisors’ restructuring success fees haven’t been paid yet
Good for you – maybe one day I will as well. No that was just on friday, most days I’m at my desk 80% of the day with a couple of meetings. Yeah I’m in just above 5p, and I had a previous short that’s already closed (months ago). Don’t really mind what happens with my position here, but I hope I’ve been somewhat informative over the past couple of weeks
Lol why are meetings such a foreign concept to you? Do you not have a job?
I’m not predicting anything, just throwing my thoughts out there. Can’t read MA’s mind, can only say what a rational person would do. But I wish you the best of luck, to be honest, I’d love it if shareholders got something good out of this, it would make a change for once. I just think it’s less likely than getting 0. It’s close though
apple, are you talking about MA or Debenhams itself? ;)
https://twitter.com/bbcnewcastle/status/1112298006785781762
In amongst the febrile atmosphere, this is pretty funny
themuir – I'm great, mate. Only a meeting later this evening, otherwise at my desk so we can argue to your heart's content!
LOL yep the price went from 2.5 to 2.6 and I am dripping with sweat!
Officemanager – care to point me to a lie that I've told?
Before everyone goes crazy, remember that the code also requires that SPD disclose any dealings made after the beginning of the offer period. No such disclosure has yet been submitted, so we don't know when the stake was increased to 29.9%
Yes, SPD is required by the code to submit this form