Member Info for gpgdk1

Does anyone have answers for the below because DGI9 and Arqiva don't.

1. The shareholder loan notes are assumed not to be external debt, but they are owed to entities like Macquarie and due for repayment by 2030. They don't seem like the type that would happy about an extension.

2. The VLNs are supposedly representative of a share in those shareholder loan notes but there's nothing on this in DGI disclosures. DGI states "The Company expects Arqiva’s future cashflows to

cover D9’s VLN interest payments". So not even principal.

If we clean up Arqiva's BS:

Tangible FA: £1b

Cash: £30m

Working capital: -£100m

Debt: -£1.5b

Shareholder loans: -£6.5b

Equity: -£5.5b

I don't see anything to distribute? Even if it's spitting £200m a year that is eaten by the interest. I can't see a scenario where equity isn't a zero. Even some of the junior loans might take a haircut. The shareholder loans are just so much larger than the actual value here. That means DGIs position is actually £0 - £180 VLNs. If the VLNs do represent access to the shareholder loans, what is the precise share, how is it governed, and why isn't there a corresponding asset?

FT investor since 2018/19 here, who also topped up with some shares from one of the co-founders. I believe I'm making around 40% profit.

Victor has always struck me as a bit of a mercenary so I'm not surprised at this outcome. VCs were always going to screw crowdfunders. I do think it's being sold on the cheap before the inflection so that the board + IG can reap the rewards in a more liquid way (ie. IG stock). FT insiders will certainly be rewarded handsomely going forwards. For reference JP Morgan and doubtless others were very likely looking at a takeover >£250m in 2022, when the business was far riskier.

I'm pretty sure they'll get the money for Big Rock at least, which is the majority of the ITC owed. Remember Elon is running the show for now and he has an fast growing BESS business that could do without the drama!

8x EV/EBITDA folks :)

Why would anyone want to listen to a aggressive outfit throwing out wild claims of performance that simply wants a listed cash pile to takeover?

Has anyone found out why Somero is listed in the UK given it is a US domiciled company? More to the point it trades well below its industry averages in the US:

NTM PE Machinery: 27

NTM PE Engineering/Construction: 24

NTM SOM: 10

Is there a chance we could see another move across the pond?

Yep I'm adding. Even if there is a recession next year Costain has years worth of orders on the books. £100m enterprise value for an entity generating £50m EBITDA and rising isn't sustainable and lower rates is just going to make a takeover more likely.

Just doing a little preliminary research and Costain really stands out amongst it's peer group of midsize contractors.

• Lowest NTM Ev/Ebit by far

• Highest NTM EBIT per employee

• Joint highest order book/revenue with Kier

It almost seems too good to be true at 2.7x EV/EBIT. Potential multibagger with increased infrastructure spend and planning reform?

Surely Hargreaves + Damian is pointing to a MBO consortium?

Excellent synopsis Meconopsis! As a citizen, I'd rather they accept Mondi, but I'll probably fully sell out once things clear up. They'll be plenty of opportunities to pick up a combined company on the cheap in the future.

I've also just sold 80% of my position as it became my largest single stock holding. Happy with the return as I picked at COVID lows. Leaving the rest to run for now, and reinvesting proceeds.

Fair review. Looks like they're pivoting to BNPL, with rental remaining at 5-10% of overall sales.

Some other good things I can see though:

•Utilising AI for device grading to improve productivity

•Opportunity to arbitrage ASPs between US and UK, MMAG is uniquely positioned to import in this way

•Books making up an increasing proportion of physical segment, which are much more resilient than DVDs and games.

At £14m net debt, enterprise value is just £24m right now, or 3.5x EBITDA that is growing.

There's a disconnect here, even for London, which anticipate resolving one way or another.

Https://www.msn.com/en-us/news/technology/best-buy-will-stop-selling-physical-media-in-2024-leaving-walmart-and-target-as-the-largest-us-in-store-retailers-for-blu-ray-dvd-and-4k-titles/ar-AA1ith3K

MMAG partner with Walmart in the US so this is interesting. I actually think physical media will stay for some time to come as I know many people who value having copies that aren't at the whims of a streamer reshuffle, not to mention archival etc.

Https://www.cityam.com/can-the-london-stock-exchange-survive-another-relentless-exodus-in-2024/

"Analysts and lawyers at top City firms say they have been prepping for a wave of deals in London after bosses began prepping companies for sale in the final months of 2023."

The entire consumer electronics industry has declined this year. Samsung's revenue will be down 14% YoY. Even Apple's decreased 3%. We've just come off the back off a huge upgrade cycle and the most aggressive monetary policy tightening in fifty years. The fact revenue has barely decreased is impressive in itself, but an increase in GM and profits demonstrates an extremely resilient business.

BT just recently expressed it's desire to dig into e-commerce so it really isn't that surprisimg they're interested. Not to mention the phone rentals would compete directly against its own business.

https://www.theguardian.com/business/2023/oct/18/ee-sell-smart-tvs-fridges-kettles-mobile-bt

I reckon red0liv3 is right though. The rns made it sound like they're speaking to someone else:

"the Company continues to seek potential buyers, and, as such, remains in an Offer Period."

Agree a TU is needed, don't think anybody will seriously entertain until then.

Little irritating but I averaged down and as I said before, theres still a good chance someone else will make an offer. This is a business that is forecasted to generate £8m in EBITDA next year. Assuming slightly increased leverage, I reckon this goes for around 35-45p. That's around a 7-9x multiple which is sensible given the growth rate. Steve just has to accept that price..

From their wiki they've dealt with BT in the past. Joint bid?

Thanks katstrangler, that does make sense.

Also meant to put how it's *not* sold for much more than 19p, obviously. I did a DCF earlier this year and it wasn't far off today's price. We're reading at what, 5x underlying earnings? There's a takeover announcement almost every day now. If BT/Aurelius doesn't go through, another likely will or Steve & co may consider a private sale.

Wondering what peoples thoughts were on the price. Telegraph article mentioned a deal worth £40m? Net debt is £18m, perhaps slightly lower now during peak season. Could that be why the price is retracing? £40m enterprise value is about 25p. Having said that I'd be amazed if final bids were around there given the founders own 20%.

The shares magazine piece make it seem like the bids could be joined - BT for the refurbishment business and Aurelius for retail side? I find that a bit confusing as the entity only works as it currently exists.

Averaging down anyway as I don't see how it's sold for much more than 19p. Currently 70% in the red.