Member Info for extrader

Hi jefff,

Its all - mostly - here : https://www.supplymecapital.com/

ATB

Hi Hardcoremechanic,

.."Also SYME would have to be on their A game, as certain elements to the jet engine have to be under certain conditions otherwise they perish, so they would need an ex aviation assessor to ensure correct storage, temperature of storage etc etc. .."

No, because the whole basis of the SYME business model is that the inventory doesn't change location (ie still in RR's warehouses), only ownership. But RR has a vested interest in keeping the inventory in good condition, because at some point it's going to want to sell it to the end-use (after buying back from SYME).

What your point highlights, however, is the need for expert assessors for all the stocklines being financed - big ticket customers like RR will be economically worthwhile, will assessing a multiplicity of varied industry , possibly low margin SME's be cost-effective and need a wider safety margin ?

I've said before, the pilot (see what I did there ?) studies of 2-3 years ago that presumably demonstrated 'proof of concept' would help address this potential Achilles heel to the business model.

ATB

Hi Longlad,

Spoiler alert ;-> !

Your link refers to the Indian concern in 2014, get to p 19 to see the ''actualite'....

ATB

Hi apunter2,

Thanks for engaging !

I went down the rabbit-hole you kindly provided and found various restrictions, but not the specific 1 year holding requirement.

I'll park this for now and may get back to it in a quiet moment.

ATB

Hi apunter2,

.."the rub for me is to prove my post I have to give a link to closed period rules..."

You make an interesting point re restrictions on PDMR sales, the only easily-understood bit I'm aware of is here : https://www.pinsentmasons.com/out-law/guides/the-model-code-on-share-dealing,
which says :

..."In any event, directors and other PDMRs should not deal in their company’s shares on considerations of a short-term nature. An investment of less than one year’s duration will be considered short-term, and consent to deal should always be refused in such a case..."

This suggests that the restriction is more advisory than obligatory, I recognise this may just be the law firm's view of FCA's historic reluctance to police the market, aka 'light touch regulation'.

ATB

No.

Hi all,

Top-quality article here, IMO, discussing China's BRI , its workings and limitations in practice, which puts the current , apparent 'dithering' re Zanaga / PN etc in perspective.

https://www.chathamhouse.org/sites/default/files/2020-08-19-debunking-myth-debt-trap-diplomacy-jones-hameiri.pdf

Against this background, I feel ZIOC is right to play up the significance of the co-ordinating role of COIDIC, seemingly - to coin a phrase, 'the only adult in the room'.

ATB

Hi all,

It's usually a good sign when Directors and PDMRs buy shares in the company and show their 'skin in the game', so it's encouraging to see the 21/08 RNS in which Chair Dominic White stumped up approx £1.5 m for 220 million shares @ 0.7p.

Some people have latched on to AZ's RNS on 18/08 reporting an increase of 1.63 billion shares in Orchestra Group's holding, increasing its (=AZ's) interest by 4.98% to an impressive 23.96% and interpreted it as the same thing.

It isn't.

If you look at the related RNS's , you'll see that
(1) Orchestra Group 'acquired 1.63 bn shares @ 0.6756p from Ceresio SIM'. This was the Placing Price; and that the transaction reported was ' Direct transfer to custody account'; and
(2) Orchestra Group reported an increased holding in SYME , reason for notification : 'an acquisition or disposal of VOTING RIGHTS [my caps]

The increase in AZ's stake is certainly sign of greater degree of control, but says nothing about any change in his economic interests....or what cash, if any, was involved in this transaction.

In any event, I think it's misleading for people to talk of a Director's 'buy' of £ 11 million.

ATB

Hi eddietheseagull,

You asked :.."Anybody know how any and every client inventory is actually assessed and secured, insured against all eventualities? - Or able to shed any light at all on this process?"

My bad ! Not p2, have a look at pp. 5 and 6 Inventory Monitoring Platform and Residual Risks. You'd have found it easily enough if you'd looked around on the site a bit as part of DYOR....

I've previously flagged that SYME is outsourcing to others some of the due diligence in the process.....and that a chain is only as strong as the weakest link....and that there's a concept in 'tech' of the possibility of GIGO (Garbage In, Garbage Out), though I've no reason to believe that's the case here. Though it's an inherent risk.
The 'proof of the pudding' will be when the system has a track record ie when it's been proven not by models but empirically (ie by what happens in the real world).
That's why it would be helpful if the Company could say more about the detail of the 2 x pilot studies undertaken 3 or 4 years ago...and how they worked in practice.

As the great Clint Eastwood is supposed to have said : 'If you want guarantees, buy a toaster'.

ATB

Hi eddietheseagull,

Same answer as in the other place :

If you go here hxxps://www.supplymecapital.com/wp-content/uploads/2020/05/2020_05_27_SYME_ProactiveResearch_equity-report.pdf, page 2, you'll find what you're looking for.

It's worth reading the whole article and poking around the company website in general, to get a good overview.

HTH and ATB

Hi apunter2,

I think we're talking at cross purposes :

- I agree your 'market cap' of £ 227.5m. But remember, this is extrapolating to the 98.99% of 'other shares' the value given to the 1.01% Placing Shares. That's a pretty generous way of determining 'value'.

- from the source document , we're told that Ceresio sold 1.63billion shares and that AZ's stake rose by 4.98%, from 18.98% to 23.96% , so it's clear that its stake was in the whole Newco, not just part of the Placing;

- and when you turn to the number you quote - monies actually raised - you'll see that Newco raised £ 2.24 million gross and received only £ 1.44million net, ie it paid £ 800, 000 or 41% of gross proceeds in fees and commissions. I know brokers and market makers have a reputation for price-gouging, but this seems excessive to me....especially as the placing wasn't underwritten (Note 5, p.2), so the brokers weren't taking any risk.
If the customer's cash is tight but the deal looks good, these intermediaries are usually only too happy to take (at least part) payment in shares. But not on this occasion.

HTH and ATB

Hi badeli,

Good stuff ! Thanks, have to say things are looking positive on the ground, better than for some time.

I'm a bit nervous about whether the 3 Gorges issue might be a distraction for any 'key decision' -makers atm...;-<

O/T , but I see you're in SYME (or at least interested). I've had a look and I might be interested as a 'momentum trade', but there are a few things I just don't get. If you've got any insights, perhaps you could share over there.

TIA and ATB

Hi bmwan,

Interesting.

AIUI, this was an 'off market' transaction. It doesn't appear to show up in the daily trading activity.

If you go to the TAG whitewash document https://www.supplymecapital.com/wp-content/uploads/2020/03/Project-TAG-Whitewash-circular-FINAL-for-posting-and-display.pdf, page 19, you'll see that the Seller, Ceresio SIM , was a post-Admission holder of 1.63 billion shares (4.98% ) in the Company...and that the consideration was , coincidentally or not , the Placing Price ie 0.6756p (p.(v)) of the document.

So it looks as though this was an 'off market' transaction, where one of the founding investors sold its entire holding to another founding investor, at an agreed 'notional' price.

I'm open to correction, but based on the above, I'm not sure that AZ paid in cash the £ 11.5m that has been suggested.

The Placing (which set the reference price) was of 1.01% of the Enlarged Share Capital.

Ceresio Sim is presumably .."In Lugano Banca del Ceresio S.A. and in Milan Ceresio SIM S.p.A. offer private banking and securities dealing. The Group has developed a world-leading expertise in the management of Funds of Hedge Funds, selecting the very best talents in the investment universe..."

And they - or their clients - have sold out, just as things are getting exciting.

Doesn't make sense to me. Any ideas ?

ATB

Hi Jiving,
..." my hunch would be IF Forrest decides upon a target there wont be much internal opposition...."

Absolutely ! But - if there's ANY opposition to a deal in C-B ( Board, shareholders, media) - it can be rationalised by the Afghan alternative.

OT : Groucho Marx is in hospital, practically on his death-bed. Visitor comes in and they discuss Groucho's various ailments, with the visitor concluding by asking him how he feels ? " Pretty good" was the somewhat unexpected reply"....especially when I consider the alternative "...

ATB

Hi Jiving,

If Fortescue DOES end up doing business in Afghanistan, that'll be one helluva 'courageous' (copyright : Yes, Minister) decision...

The country is land-locked and its ore, per wiki, is mostly in mountainous Bamyan Province, which is 1100 miles from the nearest sizeable port, Gwadar, in Pakistan.
Gwadar itself is a keystone of China's political/economic/strategic investment in Pakistan see https://eurasiantimes.com/china-is-developing-a-naval-base-in-gwadar-pakistan-to-compliment-one-in-djibouti/. I suppose iron ore exports could tie in to the mooted 1800 Km overland link to China ....if it ever materializes.

This (Indian , so consider the source) article doesn't think so : https://theprint.in/world/cpec-chinas-most-ambitious-project-in-pakistan-has-become-a-corridor-to-nowhere/374430/

The cynic in me says that this is a cunning plan to scare the cr*p out of the Board , after which the proposal of a consortium deal in C-B with FMGL's long-standing Chinese partners will seem a cakewalk by comparison.

You read it here first !

ATB

Hi IraMil7,

..."but now realised the CGT will eat a lot of potential gains,.."

Remember that you have an annual personal Capital Gains allowance of (currently) £ 12,300 ie up to this amount is taxfree.
And most of us make the occasional loss on a share - if you keep a record and inform HMRC, these losses can (under certain circs) be used to offset other gains.
Which reduces the pain of the loss, somewhat...

All IMO, DYOR etc
ATB

Hi Miles 8586,

(1) Re bed-and-ISA, this is usually done in-house, on a matched bargain basis, hence the (usually) narrower-than-normal bid/offer spread. The back-end paperwork may take longer (but in this day and age shouldn't), but the sell/buy should be virtually instantaneous (after all, 'You" are on both sides of the trade), so the realised price would hopefully be irrelevant.

(2) Remember that, apart from ISA, which is better for LTBH, you can also take advantage (if not already utilised) of your annual Capital Gains Tax allowance... so you could realise this tax year up to £ 12,300 of gains on disposal from an unsheltered account before being liable to tax. And likely (unless rates change) the same next year.

If you've got young kids, you may find you'll need/want to sell at least part of your investment earlier than planned ;-<

As well as offsetting any other capital losses you might have, which most people do, at some point (and which reduces the pain of the occasional bad investment...)

All IMO, DYOR and good luck whatever you decide.

ATB

Hi allthatguff,

AT was a little coy when I taxed him specifically re the rather last-minute nature of the SCM subscription arrangement.

He suggested that back in Jan/Feb m'gment was aware but unfussed about the co's prospective funding needs....'and then Covid happened'. And wouldn't say more.

Make of that what you will. As a stand-alone explanation for 'sleeping on the job' , it's plausible. "The dog ate my homework"....

Alternatively, if confirmation bias kicks in and you choose to tie that comment in with the autumn 2019 LTIP/Retention package, followed by the December 2019 announcement of the framework agreement with COIDIC, it suggests something was (and hopefully, still is) afoot....and did indeed get derailed.

Who knows ? Certainly not me !

ATB

Hi beardozer,

I like the quote....and the underlying sentiment !

Have you read "Blood River: A Journey to Africa's Broken Heart "? a journalist's trip down the Congo, retracing Stanley (of Stanley and Livingstone fame)'s footsteps/canoe journey.

Brings home the challenges (man-made and natural) in the area.....

ATB

Hi allthatguff,

As often, I find your view chimes with my own.

..."Clinging onto this for nothing makes no business sense, at all..."

From what I've seen/read , most outgoing top dogs (business, politics, whatever) pay at least some attention to their legacy. They'll want to end on a 'high' [ though politicians seldom do, as one J Enoch Powell presciently observed *], if they can. Market circumstances and 'events' may not allow this, of course, being outside their control.

They'll certainly try to tidy up loose ends/deal with unfinished business within their control, for a variety of reasons, some more charitable than others - they may want to make a difficult decision so their successor doesn't have to ("a Good Thing") ; so they can 'manage' or 'spin ' the storyline whilst still in a position to do so ("ho hum") ; or , less nobly, make the decision and take the credit so the successor can't ("scorched earth policy").

Or a combination of the above . Most people are complicated enough, capable of multi-level rationalisation.

I think politicians and business leaders are in a league of their own. Let's see what Ivan does ;->

ATB
* Powell : "All political lives, unless they are cut off in midstream at a happy juncture, end in failure, because that is the nature of politics and of human affairs."
** Powell again, topically , writing for The Guardian : "For a politician to complain about the press is like a ship's captain complaining about the sea."