The latest Investing Matters Podcast with Jean Roche, Co-Manager of Schroder UK Mid Cap Investment Trust has just been released. Listen here.
The price rumoured showed that this was a bad deal for most shareholders. Not so much a merger but more an annexation. It's an escape for now. To my mind finnCap need to ensure that everybody in their organisation is pulling in the same direction.
Looking at those large trades and the two highest blue trades, my feeling is that we have seen CrystalAmber sell their last chunk of EQLS. If the acquirer already owns stock we might well get a major holdings notice, revealing the name.
Regarding the Dec TU, will refrain from any optimistic guesses on the numbers but naturally full of hope.
Another link;
https://www.finncap.com/news-events/entrepreneur-vin-murria-takes-significant-stake-in-finncap-with-key-advisory-role
Well AM has shot down my first idea, which brings me to my favourite idea. Which came to mind as soon as I saw the major shareholders list for FCAP last month. Vin Murria, is this 'merger' her baby? Will she be fully involved with the new unit if it goes through? She seems ruthless enough, which is not a criticism.
https://www.theguardian.com/media/2022/jun/19/vin-murrias-bid-for-mc-saatchi-is-her-most-daring-yet
She didn't win that particular battle but didn't lose either as the collapse in acquisition rivals, Next15's shareprice made their bid unacceptable. Does she see Cavendish backed by new money as her next project?
Don't worry no more ideas from me.
20p for an agreed deal would look rather meagre. A number of individuals with sizeable holdings in FCAP, including Sam Smith. Likely they hold the balance here. With regard to cash holdings, is it possible that a deal is agreed for early next year, which would allow FCAP to distribute some of this through a dividend payment? Obviously that would be done with prior agreement with Panmure Gordon. Though not necessarily announced on notification of any merger deal agreement.
Somebody is buying. Next set of numbers should have the full benefit of Equals Connect. I read in a recent report that the revenues for Solutions ( or was it overall?) were 27% fixed-fee based and 73% transaction value. If inflation is creating higher transaction values, that is a significant amount of inflation-proofing built-in, even without fixed-fee increases.
I bought a few on last month's rumours. The sp had dropped too low in any case. Have read that Panmure Gordon are specifically interested in the Cavendish side of the business. The growth profile of Cavendish means selling the business would be bordering on insanity unless it was an insane offer. If so, would the cash received be distributed to shareholders? Would not want to hold FCAP afterwards.
Taken a while to write my take, on what was said at the InvestorMeet presentation on Oct 13. This time it took place with video as well as audio. Beeks were represented by Gordon McArthur, CEO and Fraser McDonald, CFO.
The event took place with commentary to a slideshow covering the events and numbers for the last financial year. As usual the most interesting part was the Q & A session that followed. The snippets below were said to random questions but have been sorted.
In response to a question regarding staff numbers, the CEO responded with "just over 100". The year end number was 89, which reflects the continuing growth of Beeks. As Gordon said "23 is the year of sales execution". In response to another question, he didn't hold back when said, "would have liked one or two more contracts".
With regard to a question on anything new, we were told that there is "no new product development on the horizon. We will be investing to improve existing products."
On the subject of inflation/energy costs, we were informed that, Beeks "can pass on power costs to monthly charged customers. Proximity customers supply their own energy."
There would appear to be a question mark with passing on increasing costs to some Private Cloud customers. With Fraser McDonald on a question regarding doing things better, letting slip the remark "writing good contracts that will allow price increases."
Regarding the recent release of Exchange Cloud, Gordon said "high hopes going forward". There were no numbers given with the announcement of the ICE (IGN) contract advised by rns on September 12. It was revealed in this session about Exchange Cloud, "about 12-18 months to billing". Which suggests they could prove to be very large, indeed potentially Beeks largest contracts to date.
We also learnt "that ICE have been incentivised to promote Beeks products". I would assume that means commission from selling Proximity Cloud to their own clients, that want to expand and develop their cloud usage. No further information available "ICE have a period of exclusivity, can't disclose details apart from already issued."
All food for thought, it would appear that Exchange Cloud could have an impact on costs in year 23 but no revenues. Therefore one or two other contracts would be welcome short-term. We will have to wait to get an idea of the potential value of this first Exchange Contract. The secrecy surrounding it, does suggest that very substantial is quite likely.
The impact of contracts that don't allow price increases could have an adverse on margins in the current financial year. Which might mean that year-end 24 could be the start of increasing profitability. Who knows, perhaps ICE have somebody in an office somewhere in their empire, crunching numbers. The only answer that makes sense is to acquire Beeks. Giving Mr Gordon McArthur an offer he can't refuse...
A lot has changed in the last couple of months, as a more sensible fiscal policy is returning to the UK. While falling US inflation, if it continues, will see a less aggressive interest rate stance from the Fed. Currency markets factoring the changes, the Dollar strength is weakening. We could see the Pound back over $1.20 very soon, unless Russia or China interfere. Is good news regarding the Acuant acquisition debt which has already shrunk in Pound terms by many millions.
Yes US profits will be getting smaller but US costs will be also. Paying back the debt, with less interest payable, is more important to my mind.
The end of the M&C Saatchi saga should put the company back on track. No coincidence that the sp has made a significant upward move today. Hopefully the company will now be fully focused on achieving organic growth without distraction.
Great update, AFX making a point of saying they serve corporate business but market volatility is probably forcing companies to rethink the hedging question. Higher interest rates adding to the coffers, even if being treated as a transitory bonus. Talk of inflation possibly hitting 15% next spring due to energy costs means that volatility unlikely to disappear soon. Especially with a £20bn Government borrowing number for last month. Good news that AFX are keeping a very close eye out for possible defaults.
We know for sure that GBG have overpaid for Acuant. Had they waited a longer would have most likely got them around 50% less. To rub salt in those wounds, the loan to buy is in dollars and there is obviously no hedge. If a US company were to buy GBG, not as cheap as looks because of the $165m loan outstanding. Fortunately they have US$ income but market confidence in the GBG board must be low.
Interesting news coming out of BarclayHedge this week, which probably explains the sp rise and suggests that AFX are doing well.
https://www.reuters.com/markets/europe/turbulent-markets-jolt-currency-hedge-funds-decade-long-slumber-2022-10-18/
I bought back in the other week. Nothing out today to cause concern. Seen MV and GP present these numbers with the slides on the website. From what they are saying and doing, I believe that they have got a good grasp of what is required to steer the company through the next year. Such as night working to take advantage of cheaper energy. The debt is manageable. Definitely worth a listen. https://sigmaroc.com/ (click on the easy to find link)
Qd22, allowing for money set aside for Mach49's earn out, Next15 made a loss. The 60% of earnings billed in dollars is not that great, when compared to the total earn out for Mach49. Thankfully now capped but still @ $300m @ 85% cash 15% equity. Failure to come up with a reasonable but almost certainly lower cap, at the time of the deal has cost them dear. If they did not protect against further sterling depreciation, when the max cap was agreed in February, then will be costing much more. If so, they should be wondering what their Nomad was doing.
If the current takeover offer comes to nothing, would not be surprised if NFC becomes a target themselves. Especially so when Pound Sterling drops below parity with the US Dollar.
Major Holdings note out this evening CA down to just over 4m shares now. Schroders appear to have bought their disposal of last week. As CA's holding is now below 3%, we won't be advised of their final sell. Onwards and upwards.
ICE Global Network Inc named as first Exchange Cloud customer
Following the announcement on 13 June 2022 of the launch and first customer for Exchange Cloud, Beeks can now confirm the customer is ICE Global Network. ICE Global Network ("IGN") has signed a multi-year deal with a period of exclusivity, with the collaboration enabling the customer to provide their client base with compute and analytics, on demand.
This could be huge, exchanges across the globe dealing with futures, energy, agriculture etc. No wonder Beeks have granted IGN (ICE) a period of exclusivity.
https://www.theice.com/about/exchanges-clearing
Exchange Cloud is a multi-home, fully configured and pre-installed physical trading environment that has been fully optimised for global Exchanges to offer cloud solutions to their end users. The successful collaboration between ICE Global Network and Beeks Group's Exchange Cloud provides a pre-integrated market-leading solution with security at the forefront.
IGN can now deliver additional value to their clients with Beeks Group's Exchange Cloud infrastructure, compute and analytics offering private cloud services at their NY4 data centre in Secaucus, New Jersey with plans to further expand the service in IGN data centres around the world.
SNN. We got a partial Q3 update today. With major growth likely to be coming from Corporates, which month in Q3 is likely to be the best for Equals? My money would be on September. I think £19m for the whole quarter is a certainty.
Good news for long term holders. Will there be a bid and if so a counterbid? Am not going to speculate or encourage anybody to buy into GBG now, it is your money at risk in the event of a no bid.
With AIM down about 34% in the last 12 months and factoring in, a roughly 10% drop in the pound in that time. It would be fair to say that there are a number of profitable AIM companies that are ripe for picking. Especially if they have a decent market presence in the USA.
Am (more than) hoping for decent numbers in October for Q3 and January for end year. Will expect CA to take advantage to offload at both opportunities. Very much looking forward to the presentation tomorrow evening at 6pm. Good chance of a market sentiment boost if and when the details of an energy price cap freeze, including something for business, is announced by the Government. Fingers crossed.