Member Info for devonplay

Serious question, those of you who've lost big money, c£100k or over, how much of this was a % your portfolio? I mean how diversified were you.
I'm just a bit shocked, and fascinated, as a long term private investor ( with a seven figure portfolio).
Even in my more reckless days of long-short bets, I would never have had the potential of that kind of single loss.
Today, my largest single position is roughgly 5% of my trading account. I maybe over diversified, but it hasnt stopped me having double digit returns every year for the last decade.
I'm genuine about the question, it always interesting to see how others run their money.
Today I hold mix of equity, fixed interest and start-up, so I not totally risk averse, most of the start-ups will go bust and I work on an 80 attrition rate.

Just buy some with the proceeds of your sale or offer acceptance.
Better still, buy a mining IT as that's going to give you diversification straight away. Avergae holding size on BRWM, under 2%, largest holding 10%, yield 4,72%

After all he did value the company at 3.8 billion

Because know one else believes it worth that much.

"Would be expect to see directors selling their shareholdings"

No, if there's a recommend deal they'll take the offer, selling in the market at this point can cause all sorts of issues for them as they might be privy to pre-market information.

"We weren’t mad after all."

That depends if you've got more than 2% of your portfolio in it LOL

I bet they haven't :)

"I was quite surprised to see that Qatar had over 70% of the convertible bonds, an eye opener for me."

It's a fascinating area if you haven't invested in fixed income before. 70% is surprising, but it also tells you a lot about the broader appetite of debt investors towards the business.

RNS's 'should' slow down after today.......
I'm still getting them for the bonds I held associated with Enterprise Inns. They will go on for a while yet.
It becomes quite a pain if you've got a couple of corporate actions going on in a portfolio.....

So we have had offers other than AA but when do we find out what these offers are??
Not very likely, times not on the company's side, so unless they have more detailed offers they'll accepts what's about to ensure it remains a going concerns and they don't end up running a insolvent business. From this point on their main concern will be to protect creditors. With only 2 month cash in hand, that's going to be the priority.

FORM 8.3
PUBLIC OPENING POSITION DISCLOSURE/DEALING DISCLOSURE BY
A PERSON WITH INTERESTS IN RELEVANT SECURITIES REPRESENTING 1%
OR MORE
Rule 8.3 of the Takeover Code (the "Code")
You will be seeing a lot of those from now on.....

https://www.nbim.no/en/the-fund/holdings/holdings-as-at-31.12.2018/?fullsize=true

Thanks for that, very useful link. Sage advice: get rich slowly and be well diversified.

"The company have a legal obligation to put any potential offer to shareholders."
It's covered in the The City Code on Takeovers and Mergers, and Company's Act.
It makes sense if you think about it, it's to stop shareholder trying to protect their position at the cost of creditors. The Board can accept an offer, when it's likely that it's the only way to proect the business from a disorderly collapse. If they don't do that and it falls into Administration we know what the likely outcome will be anyway...as there's almost an offer on the table already for the Administrator to accept. In this case with the Convertables it's going to be a done deal in my opinion. There's a point when you've run out of money that the shareholder go to the back of the list, even before the business hits the final buffers or Administration or Liquidation. Directors will be very cognoscent of the risk of running a business that trading without being able to satisfy creditors and how that impacts their personal liabilities.

So it's looking likely there isn't going to be any other parties because it looks like decisions have already been made. ?

That would be my guess, if there is an alternative then it have to be actionable in the short time left. In those circumstances there's a good chance that a Board would work with the first reasonable offer that offer continuity and reduces their own potential personal liabilities. Only my opionion.

The company have a legal obligation to put any potential offer to shareholders.
I don't believe that's the case if there's undue risk of the alternative being collapse. If they think shareholders will reject the offer that could protect creditors then they can proceed without pre-emption rights and a vote.

"Let's say there is more than AA interested in SXX, are they obliged to say this or can they keep it quiet??"
At this late they are obliged to do their upmost to protect creditors, so even if they have a hight offer they will work towards securing the most likely outcome that protects creditors and keeps the business operating as a "going concern".
That's their primary objective, to avoid a disorderly liquidation. Both parties are required to do due diligence, both buyer and seller, and in this case the Board will need to demonstrate they have followed a stratgy to protect creditors. Not doing so, mean they can expose themselves to direct risk. In most cases Boards will take to deal mostly likely to proceed and leave the business as a goign concern and reduce their own liabilities. It's a matter of if they think a higher offer is proceedale in the short cash runway they have. It's a way to protect the business, and ensure it's continuity, from time wasters and chancers.

"Are there any overriding issues that stop the UK government from issuing sufficient loan guarantees to cover the required £500m?"

Are there any over riding needs for them to even consider it now, the futire of the company has potentially been secured.
How does offering an alternative benefit tax payers?

"As to the bond holders, they are laughing, they'll get bought out @ 100% else they'll hold on to them?"

I've never owned the debt of this one, but have been watching it for the possible chance that a debt offer would come along that was less speculative. Given the possible long term earnings, a secured issue with a decent coupon would have been attractive once shareholders has provided the "risk" capital and the business was up and running.
That's not going to happen now, but at least it's all reminded me that when I do "specualtive", I at least want the upfront benefits of SEIS/EIS tax relief. As well as having an existing diversified portfolio of other assets.
Shame, I'd have been happy taking payments for years on the debt, even 4%, with a PIK or inflation hedge.

Remember as shareholders we own this company. The BOD are in fact just employees of ours!!!!!! If they cannot do better stop paying them and ……………………………………..
That's not the case, when a company risks defaulting on it's obligations, ie runs out of money, the Board's key responsiblty is to secured creditors, unsecured creditors and shareholders lastly and in that order.
They can't reject any reasonable offer without consideration if it means the company might fall into a disorderly
insolvency. Given that the money is gone, or will be by March, at this stage they will be more focused on winding down the business in an order;y fashion than anything else. Having an offer, little cash and a hard date won't permit them the luxury of "deal chasing". Once the existing offer has to be firmed up, or they walk away, then all eyes and attention will be managing the business into Administration. In that circumtance, shareholders are bottom of the pile.

"if Sirius announces a "whitewash" transaction"

and the chances of that...

Long-short equity players.

"What do you think would happen to the company if shareholders reject this offer?"
I believe the Board can proceed without having a "vote" if they believe there's no altentative and rejecting the offer would lead to a disorderly insolvency. In that case you would be come a Dissenting Shareholder. That gives you very limited rights, the best you can hope is that you get bought out as a nuisance. That may or may not happen and there's no time limit. So, it could happen decades down the road. I did that once for a major uk list and cleaned up there "dissenters" from 1936, in 1986. In practive Nominee accounts offer very little ability to "dissent", if you hold "paper" you can at least refuse to sign transfer documents and take a chance of how they treat you.