Member Info for devonplay

My take on it: av price 130'sh, just under 50% capital returned via dividend, less the 5% of my porfolio

AI is a reasoning and discovery machine, HGT's boring software companies are data rich and core structures in the business that deploy them. No one is going to throw out a core management system, what they will do is reduce head count and invest in software as they always have. Less but more expensive "user" base and the vendors will co-pilot the techonlogy into their offer, less grunt work but more expensive descision driven and enhanced management control. HGT's companies are by design boring. The manage ledgers, records payroll and compliance, they are not reasoning machines, but alone and without them reasoning cant take place. AI isn't desgined to be a record of data, it's desinged to help in reasoning around that data. The risk is that HGT companies don't manage to pass on the benefit of co-piloting and of course charge for is, the sell is Mr FD cut your head count and let us make you more efficient while not surrending the structures you've built your business around. The balance sheet will look better, you will be more agile and you keep the spine of your enterprise and the vendors will make more money, whilst also probably reduce their own costs. If there a question about IPO, and then there is, then the European market place with have lost of opportunity to consolidate and HGT's anthropic friendly companies could benefit. I wait for an opportunity to benefit from the panic.

I have been cost averaging these and come up 8% plus the yield, so I am sort of OK with that.
For some reason I couldn't stream today's video presentation, so I've had to make do with the downloaded presentation. Shame as I wanted to hear the institutional investors questions.
Simplification, cost reduction and growth. I am happy to sit back now and see what happens.
I am going to hold them post ex/rec dates.
I understand they've launched a voluntary redundancy campaign today.
I may trying to have another look at the vidoe again. I think I remember they have recording of previous ones in that IR area. Even if it's just the Q&A's, not the scripted section.

I'm still hearing people say they haven't been paid. Apparently Lendinvest made a payment on the 7th, but the money has got lost in the system. Modern equivalent of the cheque is in the post? So if the money hasn't been credited today LendInvest are now technically in default. Default on a public listed bond, when they have still have the rump of LIV2 due in October. Miserable stuff indeed. It makes you wonder what's going on there.

So, it appears LIV3 investors might still not have been paid. Tomorrow is the last day before the bond falls into default as I understand it. So will they be issuing a notice in the event of default today? If they did, I wouldn't be surprised if LINV didn't test the very lows of last years.
Management playing chicken with the bonds, or is there a deeper cash flow problem hidden away. Didn't the founder recently sell a couple of million quids worth of stock to meet demand....

So still no payment on LIV 3, that will fall into a default mid week next week.
If there is a major issue then a Creditor Committee can call on an accelerated repayment of the bond, capital and interest and LendInvest has give 20% guarantee. Of c£60 million. Issuers obligation.
If there is a problem then there's been a collapse of expectations within 6 months of issue...it makes you wonder what else might be lurking in the rest of LINV.
Not to mention the fully secured LIV2. Frankly, they are best avoided. This is bad news. It could be very very bad news.
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A bond that's very recent

Did anyone watch the capital markets teach in last weeks, the presentation was on the IR site, but not the video last time I checked - a few days ago.
I'm in at an average 36p and good chunk of my equity has been returned via the dividend and special div, so it I guess it's been quite de- risked for me.
I still remain excited about the potential for the digital, asset management play. If they get that right it feels like there's plenty of upward opportunity left in the tank.
Balancing the solid currency activity with the new channels won't be easy, but if they manage that, and there's no reason in my opinion that Leslie won't, she a character, but I think a very capable one. I'm also impressed with Steve Cullen. Neil Records track record stands on it's merits. Then this could still be very much the start of the future.

https://www.lse.co.uk/SharePrice.asp?shareprice=LIV3&share=Lendinvest27
I've seen similar comments on several boards, brokers are chasing the Trustees for the funds...without any success. It might be a storm in tea cup, there are occasional late payers that go up to the wire, but I guess we will know next week.
The optics of it don't look good, but LIV3 is trading around par, well it was yesterday, so who knows.

So Lendinvest appears to have failed to pay the interest on it's ORB (retail) bond on the 8th February. They have 2 weeks from the 8th to pay, after that it's possible for the bond to be considered as "defaulting":
11. Events of Default
If any of the following events (“Events of Default”) occurs and is continuing, the Trustee at its
discretion may, and if so requested by holders of at least one-quarter in nominal amount of the Notes then outstanding or if so directed by an Extraordinary Resolution shall, subject in each case to it being indemnified and/or secured and/or prefunded to its satisfaction, give notice (an “Acceleration Notice”) to the Issuer that the Notes are, and they shall immediately become, due and payable at their Early Redemption Amount together (if applicable) with accrued interest:
(i) Non-Payment: default is made in the payment of any principal of or interest when due on
any of the Notes and such default continues for a period of 14 days; or

There's a limited guarantee from the parent, but if the cash expected by LIV3 investors isn't received and the bond falls into default, you have to wonder what other covenants might be triggered? So a default would trigger an EGM and potentially the guarantee to be called upon and the acceleration of the due date. That's a hit for LINV and a fire sale.

This appears to be the first due payment on the bond and Lendinvest appears not to have made it - when you look through forums there some chatter about it. I was watching the stock before the rally, I'm now sort of glad I've sat on the sidelines. It may be just a glitch, but an unfortunate one. It doesn't look good when a company fails to pay within a few days.

Which is a bit surprising really as the FT has been reporting for ages on how Alibaba has been pulling back on it's plans for global exapnsion to deal with underperformance in the US.
I haven't checked the stats lately, but the last time I had a look they'd taken down their expectations from 1,000,000 US companies to 2000 each year....which suggest they recognise the difference in manufacturing costs. When you throw Beijings crackdown on tech. businesses into the mix and the politics associated with buying a listed company in economies that having become more hostile since 2014, it sounds like one of those "trading floor" ( LOL) rumours desinged to drag in retail investors. A nice little start to '23 for someone...as far as that rumour is concerned, I would check and see if it's being covered in the FT. If it's not...then I'd ask myself why not?

Where have I heard that before ......LOL

DARK, HBR, or SFOR. They are all great companies LOL
- isn't HBR nearly 30% down since may and it's major shareholder is selling out?
DARK, HBR, or SFOR. They are all great companies ...........all best avoided if you ask me.

"I only wonder if it'll not end up with simply Phoenix having nicely increased their holding in SG at this price and it'll remain on the Exchange... They paid 2.5p to get involved why not take another lot of shares at this price..."
Very, very unlikely. They'll stop just under the point where they are required to make a formal bid, but guaranteed to get the stock delisted. As they can pull the trigger on the debt at any time why would they show offer anything more. My bet is they take it private at 1,5 revalue it upwards sometime down the road and show that as increased NAV in the portfolio of one of their other vehicles. It's pretty much worked out as I said. Overall I think they are being generous in offering 1,5p....they could have quickly turned it in 0p.Peals correct....it was only months ago there was that 20p prediction!
It looks like SGI have lost another customer. Pearls, it was always there in the tea leaves....don't take it out on them now. You were always so excited about the auctions and fractional junk. Just enjoy the largesse they are offering at 1,5p...it could have been so much worse.

"I would like to know one thing - why do you think they have pulled the plug on the listing now? "
- it's easier to attribute value to a private company than the public one. There's no weighing machine that is the stock market.
- they failed to achieve the momentum that you expect of a growth stock, the trading looks and feels poor
- it saves them money on listing costs..every penny must count.
- it's easier to carry out "restructuring" outside of public scrutiny. Public turn-arounds can be painful when every one can read, and comment, on the required "list" reporting.
- it's time consuming, private company consume less over head
- I've also wondered that at some point, it becomes a subsidiary of one of their other vehicles. That might shore up under performance somewhere else IF they eventually turn SGI around.
I don't think the staff matter much in this, as I've said before, I think the only value in SGI is the brand (hence 0.5 valuations) and the existing staff are just grist for the Castelnau mill.
As you've said you before....they are masters of financial engineering. Unfortunately, in this case, that could be at the cost of SGI ordinary shareholders.
Companies with a controlling entity often get heavily discounted for the reasons we are seeing here. What you've readily described as a supportive shareholder....was really always a great big flash red light...screaming DANGER.
If you are suggesting that one shareholder is privy to more information that the market "privy to much fuller figures" that's bad news for minority shareholders like you.
You are nothing more than flotsam and jetsam...with SGI it's the dictionary meaning "The remains of a shipwreck still floating in water"
It's been a floating ship wreck for years.

Phoenix will preserve their assets in default, the Magenta returns to them and they'll convert their debt into equity after default. By your calculation, but you've not taken into consideration the holding of other collective vehicles, which you presume the Directors have already been in contact with and that's why they are confident about the de-listing going through. If the it fails on a vote, it will be pushed through under the statutory powers Directors have to avoid a company trading in an insolvent manner. They'll negotiate with Phoenix, that will result in them not being a going concern and they'll transfer ownership to them for a pepper corn value. They wouldn't lose their shareholding, they just gain 100% ownership out of the insolvency. They wouldn't losing anything of value, just the cost of being listed. Debenhmans, like SGI, had multiple creditors, but like SGI, Debenhams had one major stakeholder in the form of it's Sterling bond issuance. They formed a creditor committee and operated in unison. So it's in fact very like SGI. If there's a chance that Phoenix will withdraw it's funding line, other creditors might take the step to pushing SGI into a wind up, if the Directors don't do it before hand. I believe Phoenix will act first, and with secure their position, in default, ordinary shareholders will be washed out of the mix.

Highly unlikely Pearls. Let's see what they say:
"However, Phoenix Asset Management Partners has also confirmed to the Independent Directors that if the Resolution is not passed, it would be necessary for Phoenix S.G. to reconsider its continued financial support for the Company and the Company should not rely on that support if the Cancellation is not effected."
That would be a TOTAL loss for ordinary shareholders, but you could bet that the business would fall into the hands of Phoenix on default.
"As the Company's largest Shareholder and the provider of all of its existing debt facilities, the continuing support of Phoenix S.G., is fundamental to the ability of the Company to continue to trade and the Independent Directors do not believe it would be possible to find a third party willing to provide such support on equivalent terms. The continued support of Phoenix S.G. will also be a pre-requisite to obtaining auditor sign-off as a going concern in respect of the Company's audited accounts for the year ended 31st March 2022."
TOTAL loss if it's not a going concern.
"Given that there is a strong likelihood that the Resolution will be passed,"
That suggests they've already spoken to other major shareholder who are going to be supportive.
As we've been through this before...if the company defaults the Directors will have to move to protect the interests of it's major creditor, in that case it's likely Phoenix will preserve it's assets, but the ordinary shareholders will be completely wiped out. If you remember Debenhams, creditors pushed the company in to default, restructured the business and swapped debt for equity leaving the previous shareholders with nothing. There's nothing to suggest that Phoenix wouldn't preserve their position in default, but you'd lose everything.

Castelnau,
Lets pretend.
Let's say you had a strategy to buy bombed out stocks, and then try to pump them on a chat site....could you ever admit to making anything less than small loses? If everyone knew the strategy was a disaster. How little notice they'd take. If they knew you were chalking up huge losses all the time.....better to talk about profits and little losses.
5 NIL :)

Hi Herdie, I'll be posting my paper, parts of it anyway, on why I think SFOR is a stonking short on that thread. I'll try to remember to include a URL for the site.
I'm off to a Festival now, so probably on Monday.

Actually, when you think about it..I should include DARK 4 Nil ;)

DARK, I said at 420 it was a strong sell. Months before it dropped off that cliff. I think the present rally is week. Best avoided.
If you want to look back, you'll see that somewhere in the SGI threads.

No, it's still got much further to go Pearls. I have it in a model that shows it reaching 80p.