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Https://www.londonstockexchange.com/news-article/market-news/schedule-one-update-microsalt-plc/16307770
IPO details
As per the admission document
Microsalt anticipated market cap based on admission price of 43p on 1st Feb (using 43.12m shares in total issue) values the company at £18.5m
TEK will retain 78.4% meaning TEKs value of Microsalt will be £14.5million
Cop out on the questions to
Will the management buy shares at current price - Clifford would not comment
Percentage of realised gains to be paid to shareholders on realisation of sale of a portfolio company - cannot give any guidelines as this would be done on an opportunistic basis... and no timeline
Konrad did state that the goal was not to grow (for example) LUCY from a $20 - $40m company and then realise value but many times this size ... nice if this happens but with the current tiny revenue very high cash burn the question is will Lucy ever get there ? From a (TEK/LUCY) shareholder point of view it would be better if someone came along now/soon and bought them outright for their patents and current first mover advantage.
Very little appetite as for LUCY the cash burn is massive ($5M+ PA) and the revenue tiny (less then $0.5M)... hence market will be expecting another fund raising ... when the money raised by the last one earlier this year runs out.
TBH personally I'm hoping LUCY is bought out by one of the bigger players who want to adopt the Vyrb technology... Lucy is definitely back as to being the runt of the litter!
On this occasion i am hoping to be proved wrong!
Lordloadsoflolly - "I hope things will take off, as I've invested here myself. But as I've said many times now, the lack of any clear exit strategy & special dividend payment means that IPOs / trade sales only have a short term impact on TEK's share price. Before it drops back down to earth again. If you don't believe me, take a look at TEK's share price shortly before & after Lucyd's IPO."
No one is disputing that the price drops down again to a significant discount to NAV and this will continue to happen going forwards. However what do you want.... Sell stakes early in LUCY (cannot anyway due to 6month lock-in), BELL, Guident and Microsalt before the companies make significant progress or wait until they have made those significant strides and NAV have increased many multiples.
Note when the shares in LUCY/BELL or trade sales eventual happen the shareprice will re-rate and then very significant dividends will be distributed to shareholders ... have a look at what happened with Braveheart in Q1/Q2 2021 to see what you could expect from TEK on actual portfolio company sales - very quick rerate/large dividends and very handsome profits... that is the ultimate prize.... not to look at /worry about the shareprice being depressed.
I'm totally with you there.
If they get the VYRB ecosystem right then that's going to provide a good repeatable revenue stream to add to the bottom line as the company is not dependant on customers one-off (or at best very infrequent) purchases of the frames
So, like you, looking for more info/progress - sometime Q4 there will be a whole load of additional functionality released VYRB 2.0 - if it takes off this will be a nice surprise and will end up adding to TEK's NAV of LUCYD.... if not then no biggie as we were never in it for LUCYD.
Baf3 - the sellers would mostly be those retail investors who were involved in the various Lucyd crowdfunding (between $1 and $3.56 per share)....so at IPO prices investors were cashing in between 100% - 750% returns.
details of crowdfunding at
https://www.startengine.com/innoeye
https://www.startengine.com/lucyd
Cm22 - i guess even at $22m the market is struggling to see a justifiable reason to invest in LUCY given there are a whole host of other companies at bargin basement prices (personally i wouldn't put my money in there but my reason for buying TEK was always on the potential of Guident/Bell and to a lesser extend MicroSalt (which now looks a potential company maker).
Unfortunately the general market reacts very negatively to doubt and with the LUCY IPO and prospectus there were a number of holes that created doubt.
1. The market didn't see a correlation between the high IPO valuation vs historical revenue/profit
Full year 2021 - Revenue = $691k, Costs = $3.3m, Net Loss = $3.2m
First Qtr 2022 - Revenue = $236k, Costs = $1.3m, Net Loss = $1.2m
FY Proj* 2022 - Revenue c $950k, Costs c $5.2m, Net Loss c$4.2m (based on Q1)
Whilst the IPO valued the company at $55m - strip out the c$6m net cash raised and you are looking at a c$49m valuation for a company making less then $1m revenue at a cost of a significant, unsustainable cash burn!
2. Lucy did not sell the future to the general market. In the prospectus there is no mention of how to bridge the valuation gap and there is no projections for revenue growth or path to profitability.
3. Whilst the Vyrb app is mentioned in the prospectus - and this would/should in future contribute to significantly to the bottom line with existing Lucyd customers - this was again not made clear in the prospectus.
So in conclusion
1. Obviously the paths to profitability and potential of the Vyrb app were made clear to institutional investors where the shares were placed (otherwise why on earth would they have paid such a premium vs the crowd funders < 1 year previously)
2. Many early investors who had taken part in the crowd funding saw handsome gains from their initial investment but importantly like the general market did not see a path to profitability or justification of the high valuation for LUCY hence crystallised their gains and sold out post IPO.
3. The general market and institutions who didn't take part in the placing like the early investors have see no justification in the IPO or even current LUCY share price - so there is no motivation to buy stock even at a 50% IPO discount.
Given the combination of points 2 and 3 the shareprice will no doubt continue to slide until LUCY management address the glaring gap (via investor presentations ?) of how they intend to ramp up revenue, reduce high cash burn and importantly how Vyrb will start to exponentially contribute to the bottom line.... until then i don't see new buyers replace the stale early investors (whilst the TEK LUCYD NAV as we along with LUCYD management are locked in).
Let's hope the MicroSalt and Guident eventual IPOs (if they aren't sold privately) don't suffer the same mistakes.
Oh and forgot to add MOEX POLY up another 6.5% on significantly higher then average volumes
Actual dummy trades on HL….
SELL 215.79 (including large volumes of shares)
BUY 224p
So probably an issue with their quotes…
Interesting that you can sell as many as you want at the moment…would suggest that there is an entity happy to hoover up any sales
$7.50 rather then $7.35 Agricore...
(The 7.35 figure is $7.35million proceeds - 980,000 x $7.50)
Given this years choppy markets led by the Nasdaq the lower end of the $7.50 - $9.50 range was to be expected.
Interestingly the 980,000 shares is more then the 882,353 figure in the SEC filing - so i am guessing there is quite a bit of interest in the shares and (hopefully) there will be an oversubscription
https://www.prnewswire.com/news-releases/innovative-eyewear-inc-announces-pricing-of-7-35-million-initial-public-offering-301605449.html
More confirmation that IPO will happen in the next few days
From https://www.sec.gov/edgar/browse/?CIK=1808377&owner=exclude
New certification of common stock and warrants of innovative eyewear via https://www.sec.gov/Archives/edgar/data/0001808377/000135445722000462/LUCY_8-ACert.pdf
"We further certify that the securities described above has been approved by the Exchange for listing and registration
upon official notice of issuance."
Looks like Monday (or soon after) is a go for IPO
:)
Over the last few days you could at often large volumes sell shares at prices > mid ( and at times I was even offered prices greater then what I could buy….I.e. MM arbitrage)
Currently can sell in chunks of 200k, with 31.85p offered for 100k tranches. However any attempts to buy are immediately routed to NT.
Someone defo is stake building at current prices :)
So let's add up
Lucyd share = £25m
Belluscura = £17.2m
Guident = £16.75 (based on May 2021 Final interim NAV)
Salarius = £4.5m (based on Jan 2022 crowdfunding)
Total £63.45m
So based on 141m shares in issue this equates to 45p shareprice.
Then consider
- ongoing exponential sales of Belluscura and resulting recovery of shareprice and onwards setting new highs
- post IPO interest in Innovative Eyewear (after all it is on the Nasdaq - so will get chased up at some point)
- Guident announcement of first and subsequent contracts resulting in a rerate of its NAV
- Salarius contracts rendering current £4.5m valuation obsolete...
Looking at way beyond 50p by year end :)
Current TEK Market cap = £36.5m
Lucyd - Post IPO - based on $6.50 Innovative Eyewear IPO price value of TEK's 65% share = £25m
Belluscura - value of TEK's 15.1% share at current £1 shareprice = £17.2 m
Total = £42.2m
So Guident and Salarius currently valued at - 6.2m!! (yes minus £6.2million)
Anyone thing a re-rating is overdue ?? ;)
Yesterday the Innovative Eyewear General form of registration was updated with the following
Previous communication (26th Jan)
"We anticipate that the initial public offering price of our Units will be between $4.25 and $6.25, and the number of Units offered hereby is based upon an assumed offering price of $5.25 per Unit, the midpoint of such estimated price range."
Yesterday Update (22nd March)
"We anticipate that the initial public offering price of our Units will be between $5.50 and $7.50, and the number of Units offered hereby is based upon an assumed offering price of $6.50 per Unit, the midpoint of such estimated price range."
Previous communication
IPO offer
2,857,142 Units, assuming a public offering price of $5.25 per Unit (hence proceeds raised = $15m)
Current communication
IPO offer 1,538,461 Units, assuming a public offering price of $6.50 per Unit (hence proceeds raised = $10m)
Use of proceeeds
Previous communication
Inventory $3,9m
Sales and Marketing $3.9m
Product Development $2.6m
Working Capital $1.9m
Capital Exp $0.65m
Total $13m
Current communication
Inventory $2.5m
Sales and Marketing $2.5m
Product Development $1.7m
Working Capital $1.28m
Capital Exp $0.43m
Total $8.5m
Tek dilution/value
Tek direct holding = 5040661 shares of innovative eyewear shares
Previous communication post IPO TEK holds 56% of Innovative Eyewear post IPO - based on $5.25 IPO price TEK share = $26.5 or £20.1m
Yesterdays communication post IPO TEK holds 65% of Innovative Eyewear post IPO - based on $6.50 IPO price TEK share = $33m or £25m
This will no doubt give the current TEK shareprice a boost when officially RNS'd
For SEC filing go to
https://www.sec.gov/Archives/edgar/data/0001808377/000182912622006577/innovativeeye_s1a4.htm
Hi Gheko,
Sorry to go on about this but your comment "So of their current 80.5% that Lucy own they are selling 25.63% into the market." still not accurate.
As per details on page 88.
Currently total share count of Innovative eyewear is 6,114,117
Lucyd Ltd own 4,922,115 (= 80.5% i.e. 4.92m/6.11m) and hence TEK currently own 80.5%
As part of the IPO, 2,857,142 new shares of Innovated Eyewear are issued and offered to new investors (bringing total share count to 8,971,259)
Hence resulting Lucyd (and hence TEK) ownership will be 54.87% (= 4,922,115/8,971,259)
Apologies if I misunderstand with your wording "selling 25.63% into the market" - there will be no selling of these existing shares that Lucyd/TEK hold... and there definitely won't be a windfall of cash going to TEK and hence no special dividend for TEK shareholders on IPO. Hopefully it is clear to you now :)
Your scenario is not the case Gheko - but don't take my word for it the detail is all in the official SEC filing document that Innovative Eyewear submitted for the intention to list - you'll need a couple of hours to read it though ;)
https://www.sec.gov/Archives/edgar/data/0001808377/000182912622001679/innovativeeyewear_s1a3.htm
Hi Gheko - sorry to dampen your enthusiasm but some of your assumptions you have made are a bit wide of the mark
Innovative Eyewear and not LUCYD is being IPO'd (under NASDAQ ticker LUCY)
TEK own 100% of LUCYD. LUCYD own approx 80% of Innovative Eyewear (hence TEK own 80% of Innovative Eyewear)
There will be no sale of Innovative Eyewear (LUCY) shares by existing shareholders as part of the IPO - instead 2.85million new shares will be issued at a price of between $4.25 and $6.25 raising between $12.1 - $17.8million. (taking a mid of $5.25 this value's TEK's stake of the IPO'd company at £20.1m - a lot more then the carrying NAV in the accounts!)
There will also be an issue of 2.85m Warrants which will be exercisable at (a to be set price) which will be greater then the IPO shareprice.
I am assuming (like BELL) there will be a lock in period for existing shareholders (6months? 1 year?)... i actually prefer that so TEK holders benefit from the growth of Innovative Eyewear and potentially benefit xfold if growth/shareprice surges as a result of sales or Vyrb app progress.
Still as you say at these prices TEK is a very attractive proposition ;)