Member Info for getafgrip

FS - I largely agree with your summary, apart from "Russian oil is being forced off the market." It is actually being re-routed (to India, China, turkey etc), obscured from scrutiny, or has extended existing markets or found new markets altogether. Western Sanctions have arguably had little impact on Russia's oil exports:

https://www.theguardian.com/world/2022/aug/11/russia-oil-production-sanctions-limited-effect-ukraine-war

The IEA stated Russia’s oil production in July was 310,000 barrels a day, falling only 3% below prewar levels. The IEA further stated that the outlook for world oil supply had been revised upward, with more limited declines in Russian supply than previously forecast

Increasing numbers of Russian oil tankers go dark around the Azores to evade tracking and detection:

https://www.telegraph.co.uk/business/2022/06/02/russian-oil-tankers-go-dark-putins-latest-sanctions-busting/

Saudi Arabia doubled second-quarter Russian fuel oil imports for power generation, diverting more of their own resources for export, but basically straightforward tip of the iceberg sanctions busting.

https://www.reuters.com/business/energy/exclusive-saudi-arabia-doubles-q2-russian-fuel-oil-imports-power-generation-2022-07-14/#:~:text=For%20the%20full%20year%202021,tonnes%20of%20Russian%20fuel%20oil.

With massive subsidies on Russian oil, why wouldn't some countries refine it & then sell it on the open market at higher prices, simply laundering Russia's crude oil. As BvB said once crude oil is refined it is impossible to detect where it originated from.

I have thought for some time now that the lack of clarity, mis-information and dis-information in the oil markets, intervention by governments (principally led by Biden and the US), & absence of the anticipated supply gap intended from Western sanctions have played a major role in the recent decline of oil prices. And not just the usual suspects, that include inflation, fears of recession, higher interest rates etc. There are many factors now pointing to a bounce back in oil prices, including China having to ramp up refinery production as they emerge from the latest draconian COVID restrictions.

A weak pound initially stimulates exports, but in tandem with this increases the costs of our imported raw materials. Effectively, increasing the cost of production of future exports. Exports are then the subject of tighter profit margins, the products may not be as competitive as those from countries with stronger currencies, and they are sold for weak pounds.

OSG - capping energy bills at £2,500, has been estimated by the big investment banks, such as Goldman Sachs to reduce inflation by 5%. However, this is neither magic nor a victimless crime. It is also not sustainable for any great length of time, according to the IMF.

Effectively it just exchanges a quick fix on energy bills for a massively increased long-term liability, namely the UK debt burden. Fitch and Standard and Poor, the credit rating agencies will put the brakes on this, reducing our credit rating internationally & we will all pay for this through higher (inflationary) lending costs until we are seen to get our house in order.

As other better economically managed countries emerge from recessionary impacts, the UK economy will be more sluggish due to the increased debt burden. Is the cure for an individual who cannot manage their finances to give them a few more credit cards and access to even more long-term debt?

27,000 square feet on the 47th floor of One Manhattan West, is 3 x the size of their current office & they are only really going to need this additional space immediately if they are looking likely to pick up US Government/defence work - it is handily placed for working with the Pentagon.

What factors do traders base their judgement on do you think?

The price of oil is governed by supply, demand, competition from alternative power sources, temperature, the geopolitical situation, Government influences/intervention & macro-economic influences. This list is not exhaustive.

EE - Who says creative accounting is dead. This left these issues nicely opaque/screened from scrutiny, not even hinted at by the Darktrace BoDs, content for the SP to go up and down like a tarts knickers and with a delayed action fuse only going off with the release of the Annual Report.

Investors are right to have concerns that this might only be the tip of the Darktrace accounting clarity iceberg! Leopards and spots springs to mind.

https://uk.sports.yahoo.com/news/theres-no-shortage-growth-recently-081231053.html

Win. Maybe!

However, the last few days have shown that Darktrace are willing to open discussions with potential suitor(s), they are a desirable company, they are growing fast and in profit, they are at a weak point in their journey and therefore vulnerable to predators, they are not interested in opportunist offers, they will extract a realistic share price from any approach. Whether by choice or not they are now in play.

TB cannot make another offer for 6-months, unless another bidder enters the fray, or they reach unanimous agreement with the Darktrace Board on takeover terms. So that any further approach could go hostile.

Arguably there are 500 or more cyber-security offerings from companies in the cybersecurity marketplace so that a lot of consolidation will inevitably take place. Most of the offerings have been built on trying to prevent an attacker entering a system. Darktrace was built originally on dealing with any intrusion. This makes them a really attractive merger or acquisition proposition. It is also such a dynamic market that a great deal will happen in a short time span regardless.

SW - Dark may easily have initiated the discussions with TB - going private for a time is the answer to many of their prayers, because they have had a really torrid time as a public company. TB's timing is immaculate.

Filtering people on the Board is just a passive response that does nothing to change persistent OCD & unwanted posting patterns by individuals. Posts have been removed by CR888 by complaints he has made directly to the LSE.

If enough people go on "Report Post" & complain about a particular poster, LSE will have to do something about it, and remove the individual from this and hopefully other Boards.

Who knows, we might then end up with a few rational, objective, factually based discussions at arguably the most important juncture in Darks journey. If a takeover manifests itself in coming days, the soap-box will be pulled from under undesirable posters, as the Board vaporises anyway!

The Saudis have gone off-script, off piste, and are playing a different game at the moment - they are determined not to be seen as a US lap-dog & are preparing under Mohamed Bin Salman (MBS) for a time when the RSA does not rely on an oil-based economy. MBS has the well-deserved nickname "Mister Bone Saw" - Blood and Oil by Hope and Scheck is excellent background reading on this and the Saudi economic and political direction :

Saudi prince made $500 million Russia bet at start of Ukraine war:

https://www.reuters.com/business/energy/saudi-arabias-kingdom-holding-invests-russian-energy-companies-2022-08-14/

Exclusive: Saudi Arabia doubles second-quarter Russian fuel oil imports for power generation:

https://www.reuters.com/business/energy/exclusive-saudi-arabia-doubles-q2-russian-fuel-oil-imports-power-generation-2022-07-14/#:~:text=Data%20obtained%20by%20Reuters%20through,same%20period%20a%20year%20ago.

I don't think a statement of Darktrace being "in the early stages of discussions with Thoma Bravo." Any talks are preliminary, early stage, exploratory in nature.

It is a quantum leap in credibility to describe these talks as "Darktrace only initiated the acquisition procedure with TB." Also, being provided with a copy of the accounts, was not really the central issue with the Autonomy takeover. HP were quite content with the takeover proceeding on the basis of what they had seen of the accounts at that point.

BBC - You are reading what you want to see rather than what is actually stated! They are in the early exploratory stages of discussion with TB, but it does not mean that any other potential bids are only considered back-up. If Darktrace are orchestrating a candidate beauty contest, they would be foolish to exclude any other potential suitors, if for no other reason than to push the price up. This would not be acting in shareholders best interests,

From your previous statements. It is also highly unlikely that TB has not been made aware of the vast majority or whole of the content of the results to be announced on the 8th September - it is one of the purposes of NDA's.

BBC - on the 17th August you stated:

https://www.thetimes.co.uk/article/darktrace-on-the-radar-of-rival-bidders-rjnpp0w26

Cisco, Palo Alto Networks and CrowdStrike, three other American businesses, were tipped as potential candidates monitoring developments. Darktrace said in a statement on Monday that it had received “a number of preliminary and conditional proposals”, but disclosed only Thoma Bravo’s name.

Now you consider, without any substantiation whatsoever, that there will be no other bids apart from TB, whilst Darktrace themselves in the latest communication on this topic & quoted by you, stated that they had received “a number of preliminary and conditional proposals."

TB came out of the blue as what you term a "named potential bidder" - do you seriously think potential bidders, firstly make their interest widely known in the markets before they bid.

God bless the mighty dollar!

BBC - There is no possibility of a hostile takeover!

If the attractions/benefits of owning Darktrace are so obvious to everyone, how likely is it that TB might ultimately be the only bidder! Highly unlikely is the answer!

If only one other bidder enters the ring it is highly likely that the bidder will be hostile to a TB/Darktrace tie-up! It is highly likely that the only friendly bid will be one that is ultimately agreed with Darktrace. The best hope for shareholders salivating over a high take-out SP is for a bidding war to take place & for the bid premium to escalate.

If they bid, and if TB are the only bidder, they will not be paying any outlandish premium to take over Darktrace, although the clowns will have you believe otherwise..

Regardless of whether TB ultimately bids for Dark, they have shown firm interest in buying the company and other predators are circling. Dark has shown it is up for grabs, at the right price, by involving itself in talks with TB at all. This introduces a bid premium element to any present or future valuation of Dark which will stay & makes it unlikely in the extreme that if no bid materialises at this point the Dark SP will fall back to its lows for the year.

A number of people are writing off ML's involvement i.e. he is just a shareholder now!

Think about it - will someone be willing to pay several billion for Darktrace, without any restraint on ML, or other key players taking pots of money & immediately setting up a stall down the road doing exactly the same thing! This will be a key part of any negotiations.

Would the US Government let ML get away with a plea bargain negotiation if he came to work for them? Seems very likely to me. And it potentially gives another edge to any US Darktrace bidders plans.

PG is right, if there is a successful bid for Darktrace, it will value the company accurately for a fleeting moment in time only.

I don't think TB will bid before the results on the 8th September. Why would they, even though they will be a party to the background information that forms the results, they should be keen to gauge the market reaction. A bid pre-results could easily be derailed by the results themselves. Why take that chance, particularly with other potential bidders around.

A premature, ill-judged bid, would only stand to erode their credibility amongst the potential suitors.