Member Info for Gerry65

sorry - last post should have said will pi's buy more confetti whilst accepting that 30% of the airport has been sold off which is ESKN's prized asset.

G

Hi Jarule - tried to reply a couple of times but my pc is playing up so a quick view on my tablet.

TOSCA's investment timing was unfortunate. They must have or maybe are still considering taking this private. They have a basis to value the airport, and should be able to come up with a reasonable sell off value for the Energy Division. There are the non core assets too. The potential Airline liabilities are known at up to £82m as is the bond at £50m, so a net asset value for the company could be calculated. atm any income based assessment is somewhat challenging lol.

That said in the recent results rns the BOD stated that TOSCA "could see significant value in the equity of ESKN and intends to support an equity raise pro rata with its shareholding".

Another question I've been asking myself is - How many PI's that bought in at the last equity raise at 40p will be willing to buy more confetti as opposed to accepting dilution whilst accepting that 30% of the prized has been sold off ?

Could be good for day trades once the dust has settled.

G

TF - have been keeping tabs on the LDG bb.

I wonder how much knowledge, if any the ESKN BOD, had of developments there.

More fun days to come here, got to love it.

Gla

G

Hi TF - agree if TOSCA pass 30% they would need to bid for what was left of the overall group, and the sp has now been below 40p fir over 12 months now.

Turning to Carlyle, if the present deal is agreed with the Banks, and shareholders, then effectively ESKN has sold off approaching 30% of the groups prize asset. The Carlyle deal is ring fenced to LSE, which is a company under the overall umbrella of the ESKN group.

I'm on less secure ground here, but to me Carlyle has no interest in the other group assets so I would be interested in why you feel, if they buy up further chunks of LSE, they'd be required to make an offer for the whole group.

I see them ultimately taking more if not all of LSE, if ESKN gets into further cashflow problems, but why would Carlyle need to be involved in the Energy Division, the Aviation business or the non core assets.

Surely if ESKN were offered a deal to sell off say 50% of one of the non core assets, which was agreed by the banks and shareholders, that transaction surely wouldn't require the purchaser to offer for the whole group would it ?

G

The RNS is pretty much as expected, the Carlyle funding comes at a £5m cost.

The split of the monies is as I mentioned in my earlier post.

The good news is that LSE will survive and develop over coming years, with the backing of Carlyle, as to who will ultimately own it is another question.

Anyone making any sp predictions as we move towards clearing present bank debt - securing new £20m banking facilities and attempting a further £40m equity raise is guessing.

Trading could be fun here yet again.

Long term - emmm - will circa 60m be sufficient to over, monthly cashburn and the £82m of Airline liabilities due over the next 2/3 years.

Assets are now 2/3 of LSE +The Energy Divison + Non core assets

Cashflow over coming months - unsure.

Could be worth the occasional toe dip trade at the right price,.

Gla

G

Hi TF - They'd need a lot more than the £120M less costs from potential new deal with Carlyle, if they look to deal with the bond at this time.

I may be misreading it but circa £20m of the Carlyle funds are earmarked towards future infrastructure spends at LSE leaving £100M to clear Banking Facility A - fully drawn at £80M, and Banking Facility B presently drawn at £15m

Then they are hoping the Banks will extend a new lower facility of £20m add to that the equity raise monies, to provide leeway in the short term.

The BOD really can't look to deal with the monies owing on the £50m bond - they'll have to let it run till its expiry in May 2024.

They'll have enough on their hands managing monthly cashflows, and trying to meet the £82m liabilities on the Airline as they fall due over the coming months.

Too risky to clear the bond whilst the Airline liabilities are looming on the horizon.

Perhaps the BOD thinks the sales of non core assets when they offload, will go some way to meeting the bond.

Only speculation on my part.

Never a dull day here.

Gla

G

TF - What are your thoughts behind ESKN selling any of their LDG stock. Isn't it cover for the £50m bond ?

At LDG's present SP, would that make sense - I'm not sure ?

G

Hi Volcano - bought into HOC @ 1.60 ish last week - which wasn't looking good yesterday was considering closing at a loss but today's rise has come to my rescue.

Bought some FRES yesterday with the profits from my SGE sale. Am watching CNE from the sidelines.

The Hospitality recovering interests me - the GRG results suggest people are into takeaways, am keeping an eye on GNC and also SSPG ( here there is an airport link ), not sure we have reached the bottom with those two.

Here we are on very very light trading today.

G

Hi Jarule - with the sp below the 40p mark for 12 months, I'm keeping an eye on the rear window, for a low ball bid to take it private.

That said the last rns from the BOD indicates TOSCA are positive to the latest restructuring plans.

We can only speculate until news lands. It's anyones guess.

G

52 week high now below the 40p raise.

39.50 on Feb 9th.

What will TOSCA decide to do.

G

Jarule - Sorry you've underwater here, you could take some comfort looking at TOSCA's average which is 70 p / 75p can't recall exactly what it is. ( what will TOSCA do ? ).

All those who participated in the previous raise at 40p and have held face a similar decision to you.

I sold a big tranche of my top slice freebies on 25th Jan - I got 38.1p

Whilst the Co. trundles on there are always options, for PI's,

Check out the situation at Luton Airport :
https://www.bbc.co.uk/news/uk-england-beds-bucks-herts-57642848

Times are tough out there, The Airline legacy issue still present challenges imv. It looks like LSE will be writing off a second year of passenger travel this summer. In the long run I see a bright future for LSE, but who will eventually own it is a different matter.

Once the dust settles assuming the Co. gets the raise off, then I'll look to trade but to be honest there are so many trading opportunities out there. ESKN hasn't looked attractive for too many day trades over the last 6 months.

gla

G

Hi Volcano - anyone's guess as to the raise price. 20p - 22p ish maybe, only a guess on my part.

TF -the rns suggests TOSCA are supportive of the raise, so to hold % position they'll need to pick up 30% of the confetti whilst accepting that a third of LSE has been sold off, emmm.

Got to love things here. With the Airline liabilities, will a new £20m bank facility and £40m capital raise be enough ?

Lots to come here over coming weeks

Gla

G

Another cracking set of results lol.

£40m equity raise coming.

Still quite a lot of financial negotiations for the BOD to resolve.

Not sure what price will represent good value for a trade.

Will wait and watch probably until after the equity raise.

Never a dull day here.

gla

G

Hi Volcano - it's been a great run up from the March 2020 crash , when so many excellent companies were dragged down with the covid worries, to bargain prices, I was like a kid in the sweetie shop lol.

I've come out of a few, over recent weeks. but am keeping quality exits on my priority watchlist, for cheaper re entries.

Been watching HOC and FRES, particularly the HOC drop - not sure the election result worries will have a major impact, as some are posting.

PM's been hit hard the last week or so, agree HOC at low 1.60's is looking compelling. not a lot wrong with its April Q1 2021 Production Report.

FED comments spooked the market.

I missed the bottom this week with FRES, so maybe worth seeing how PM 's open on Monday, a little dabble on HOC may well be in order next week.

Should be fun and games here with ESKN between now and the end of the month. Got the YR end report, maybe an equity raise, and more info on the potential Carlyle bond.

Have a great weekend mate , time to get ready for the footie.

G

An equity raise at 20p say ( or lower ) will create loads of confetti.

The RNS says a modest equity raise may be needed. Only 10 trading days till the end of June, by which time the YR21 accounts are due to be released.

Expect news soon on the Carlyle bond / revised banking facilities / equity raise requirements very soon.

Gla

G

Birddog - that could well be the case.

Looks like part or all of the Bank funding will be replaced by Carlyle funding under the proposed new bond.

If that goes through will the Banks extend any replacement borrowing, secured on the remaining assets in the group ?

If not then the Energy Division future earnings will need to be sufficient to cover both the ongoing airport costs, and the SA liabilities when they fall due.

It's all a bit muddy here, from the info provided to date. Sure it will become clear soon enough.

Gla

G

Should all become clear over the next few days.

Good luck to all holders here

G

My last post was just me throwing out some thoughts and figures.

If TOSCA are sitting at an average - bet 70p - 75p - they would need a market cap of crica £450M to stand any chance of disposing of their shareholding at cost ( assuming there are buyers out there).

What do PI's think they'll do ?

Any thoughts on how that value could be justified ? Either on cashflow, NSV , growth or perhaps sentiment ?

Still could be fun for trading though, a quick in and out maybe.

Gla

G

I'm guessing the present banking facilities are secured by debentures. If the Carlyle bond goes through, ring fenced to LSA, then the banks will have to release their security here to allow the bond to be completed. If so they'll probably expect repayment of present borrowings The RNS confirms that ESKN has used up £10k of facilitty B - therefore I assume the £80M facility A is fully drawn at £80M.

Looks like the banks are backing out, here. How much of the bond funds will be left for cashflow commitments ?

Under the 2020 aborted airport funding, the airport could then have been valued at circa £800M now its a lot less, or another way of looking at it is that shareholders are releasing 30% of the previous valuation for (£240M ) for £100M of survival cash, and £20m of Carlyle costs. Emmm.

Looking at it from the BOD's prospective - Beggers can't be choosers.

How do existing shareholders value this ?

On the negatives we have :
- Previous £50M bond
- Bank debt or new Bond - £100m
- 82M of SA liabilities for YR 22 - YR 24

Assets
- Energy Division - value - perhaps still £200M
- LSA - likely to be 70% ( value ? )

Cashflow - Energy Division hopefully returning positive, Aviation - unclear

What will TOSCA do now? Agree TF / Birddog its likely to go private.

Birddog - LSA will continue and develop as a project, as to who will own it long term - that's less clear.

gla

G

Beggers can't be choosers.

Hi TF - Not sure I'll be jumping in early doors tomorrow, there is a lot to come out here.

Additional cash impact arising from the liquidation for YR22 - YR24 without sub leases is estimated at 82M

Am trying to put myself in TOSCA's position, it bought in for 30% of the equity here at 70p + average, can't remember it might have an average as high as 75p, would have to look back on my previous posts.

Will it be happy to allow a deal for an outside partner to buy into LSA, for survival cash, at the cost of trading away a large chunk of the underlying asset ?

Would it be better for TOSCA to take ESKN private, for a low ball, figure, accepting the bank debt and the SA liabilities, then deal with the potential strategic partner, at that time.

We'll find out over the coming weeks, any day trading will be fun here.

gla

G