Member Info for DJP4976

Might be a nothing to be fair, as the documents just updated on companies house and the signatures were from 27th June, the day before suspension and announcement of possible RTO.

Think it could just show that terms of a deal have potentially been agreed with Sorted, we’ll find out if so on Monday AM.

Nice to see activity quickly happening behind the scenes -

Memorandum and Articles of Association

And

Resolutions

Resolution of allotment of securities

Resolution of removal of pre-emption rights

Resolution of adoption of Articles of Association

Updated today Saturday 8th July on companies house - might get a Monday LSAI RNS with potential deal terms? Suppose deal needs to happen quickly to save Sorted going under

Yes I voted this morning I’m with IG

I reckon LSAI management and shareholders have likely seen where they can immediately save costs, and grow revenue to allow the business to very quickly become breakeven or even profitable in the very short term, as an £8m loss per year, cash won’t last long at all.

My guess is all LSAI warrants get converted at 0.2p, management and/or sorted shareholders also put in £5m at 0.2p, that’ll give the business plenty of cash. Relist price around .2p and possibly do a share price reorganisation also to decrease the number of shares in issue

Yep, September is mentioned in that article which would be a short suspension for an RTO as some can taken many months, but likely a lot of background work has already gone into this.

Sorted has had $100m pumped into it in the last 9 years with majority within the last 4 years, and LSAI could be picking this up for a snip of what has been invested. They certainly have the people and management to potentially turn it around. I was personally expecting a profitable business to come in, but in that case you’d likely need to pay a premium with potentially not as much upside. If these guys can turn this around, the upside could be pretty spectacular from a low starting point, as I’m pretty sure at one point only a couple years ago when $40m was invested I think it valued it at over $100m.

Looking forward to hearing the details of the deal, if management of sorted align themselves with current LSAI holders to the tune of £5m and LSAI warrants get converted upon deal, everyone involved would be fully invested in getting this business turned around.

Https://businesscloud.co.uk/news/what-happened-at-techs-poster-boy-sorted/

I don’t think that’s the case no, discussions will be happening now between LSAI and sorted management and shareholders to come to agreeable terms, once they’ve agreed amongst themselves we will then be given the details of the discussions and genera meeting for approval of LSAI shareholders.

If discussions with sorted fall through, we will either relist without a deal and in the same situation as previously or in the time we are suspended a better deal could present itself and it could change to that new deal.

I can’t admit to fully understanding the deal, but if I’m right, LSAI I picking Sorted up for £1 nominal value and taking over debt.

Considering sorted has had £73m+ invested in it since 2014 and £60m+ since 2019, that’s a lot of value destruction for current sorted holders, but could be very lucrative to LSAI shareholders if they think they can turn it around.

They also have almost £25m of net assets in September 2022.

Like I said I could be getting it totally wrong, but if that is the case and LSAI are just taking them over for £1, taking over £4m debt and giving a bridging loan of £2.6m, get sorted holders/management to invest and the current LSAI warrant holders all exercise their warrants to further inject cash, we could be looking at a decent turnaround.

Baring in mind if they don’t raise with any retail and the raise stays with current Sorted investors and directors, and LSAI holders and management convert their warrants - LSAI should in effect remain just as illiquid on relist as it was before it suspended.

Interesting times ahead but from a sub cash position that LSAI was trading at before suspension, really the only way should be up from here if it goes through

Also agree with Westbury, this deal has likely been worked on in the background for sometime, so I can’t see it being a very long suspension, maybe a few months at the max unlike some that seem to take forever. Nigel Burton alluded to that fact when I’ve had contact with him previously that any deal wouldn’t be announced until much nearer the time of RTO. He’s also stated a number of times that any deal would be expected to create value for shareholders, and majority of holders are in at 0.2p+

Also, baring in mind who is involved here, Kamani family, Booboo founders and pretty little things, Richard Hughes Zeus capital, turner and pipe family, bunch of Boohoo directors and founders/execs etc, if this deal goes through it should gain some national press also IMO, that coupled with a very illiquid share ‘IF’ the deal is structured as per below and not a huge raise with retail, it could be a flier on relist, all just my opinion

I have no doubt whatsoever that it will not be lower than 0.2p for LSAI holders, they currently have £4.1m cash as per results, which equates to .155 per share alone, that’s without the value a listing attains and the deferred tax asset.

Also these guys put in almost £4m in 2021 at .2p, directors have been being paid in shares at 0.2p, so do you honestly think they will shift themselves and do a deal lower than that price, it isn’t going to happen.

I have been hoping for a premium RTO at say .3-.4 which could potentially still happen, but if management want existing Sorted shareholders to contribute upto £5m in a raise to align themselves with LSAI holders then I would imagine that’ll be done at 0.2p being the same price the majority of SH and directors of LSAI are in at!

Like I said in a previous post, even if it is only .2p, if they raise with just directors, vendors and management or Sorted, and/or LSAI shareholders exercise their .2p warrants, that’ll mean LSAI will remain just as illiquid on relist as it was on suspension, which would mean it could see an almighty move on low volumes.

Going to be interesting times ahead but given current cash position of LSAI and where management and concert party entered it won’t be a shafting that’s for sure

If the RTO happens at .2p then it’ll gap up to that price when it relists, same for if it happens at .3 and .4 etc etc.

More I think of it, the more I think it’ll be done at .2p rather than a premium, just so all the investors in SORTED are in at the same price as LSAI shareholders

Not a major issue as if they don’t raise with retail, and only raise with SORTED shareholders and Management and LSAI warrant holders, it will remain fairly illiquid on relist and could be a flier

Can’t really get shafted from the price we were trading at. We have .155 in cash and trading below including a £5.4m deferred tax asset, the deal if it proceeds will be valued at minimum of .2p in my opinion which is still 40%+ to the closing offer price. Any more is a bonus, I’m personally hoping to see a deal in the .3-.4 range, think that’s realistic - .37 values us at £10m, £4m cash, £5.4m deferred tax asset and cost of listing etc

Let’s see

Now it’s a waiting game to see if the deal is concluded on adequate terms to LSAI.

I’ve had a very brief look and they do seem to serve a lot of the major retailers.

Be interesting to see what price the deal will conclude at, if it does conclude, would have to think it will be at .2p or higher!

That’s literally all it is a game of being patient, adding on any dips, which unfortunately I won’t be doing as I have more than enough already, and just knowing that these guys aren’t going to be doing a deal for less than their entry at 0.2p - so minimum upside from current offer price is 35-40% to 0.2p.

Factor in they themselves have been waiting for 2 years for a deal and if they want to see a minimum of 50% uplift for that 2 year wait you’d have to think a deal at 0.3p+ which is a bagger+ from this level

Hopefully we’ll get that long awaited news sooner rather than later.

Maybe, who knows. I believe we will see a complete new direction in the tech space myself

I personally believe they’ve kept verify running in the background to save them becoming a full on cash shell and having to do a deal within a certain timeframe or get suspended and potentially delisted, so I’m personally not concerned about revenue from verify as when RTO occurs it’ll get written down or sold out.

LSAI have cash of £4.1m equivalent to .155p more than I even expected and is now trading sub cash.

Also the deferred tax asset has increased to £5.4m

All in all, fair value on an RTO should be north of 0.3p as adding cash with the deferred tax asset works out at 0.36p per share - should be a bagger on a deal from here

Lol

Very annoying drop considering only £4K or so has been sold, but seems to have found it’s bottom again as there’s 10m BID at .12 so shouldn’t really be much more downside from here considering market cap is now yet again covered by Cash levels!