Cobus Loots, CEO of Pan African Resources, on delivering sector-leading returns for shareholders. Watch the video here.
That is my exact point - you have made a call on the benefits/problems and judged it to be better than a diluting placement. That's fine - your call of course to think however you wish. Decisions to buy/sell shares is based on rational judgement of a firm's future performance and borrowing activity is another bit of information. If the firm decides to borrow people will make a judgement on reasons why and on the future implications for the firm. That may mean they want to add to their holdings or reduce them. This is an operational decision without any flexibility afforded to shareholders.
I am with you there PC54. The suspension on shares was some time ago now and we were all waiting for news on what Mr Gupta had planned. Now under the ARL logo a fund raise through Abundance... again. How can there be a bond fund raise without shareholders being able to adjust their holdings accordingly?? 8% of �5million is and extra �400,000 pa that will be leaving ARL coffers destined for bondholders - and we cannot change our equity stake in response? That is just weird. What is going on?
My firm have it at 7.8/8.0 at the moment - so mid under 8p. Officially concerned now - said at the placement this would have real trouble getting beyond the placement price because the way it was handled.
Was there not a bond issue last year that raised a few million? According to Abundance at the time, it was the fastest take-up they had had. Any idea where the money was spent and on what? Seems fishy to me for another bond issue so quickly with so little mention of how the last money was spent.
Seems as though I was rather optimistic about the sp in a year's time as I had it down for 9.4p.
So, in the spirit of free marker capitalism a firm the size of Carillion is allowed to fail. HMG and RBS (taxpayer bailout recipients themselves) both say no to being part of a rescue deal. The result is that HMG must bring in-house many services at considerable extra expense. In addition, the firms given the contracts are now exerting their monopoly power and want 20% extra (see BBC below). Not quite text-book free market competition is it Theresa? The fall-out is going to get a lot worse too. BBC News: "Sources at industry competitors tell me they will want up to 20% more than Carillion was being paid to take over manifestly under-priced contracts. If that is even close to correct, the failure of Carillion will end up costing the government and the taxpayer many hundreds of millions of pounds."
...not to mention incredibly bad avertising for Equiniti.
Private Equity firms are looking for fast deals to cherry-pick remnants of CLLN according to FT. I wonder if this sort of thing was ever on the mind of HMG when they pulled the plug last week? Can't wait to see if anyone anywhere in HMG, family or friends stand to gain from all of this. Rather dramatically last week I though the decision political suicide for Mrs May and her bunch - nothing this week has convinced me otherwise.
Indeed CM. I was questioning Equiniti's planning and particularly their lack of planning for every eventuality. Liquidations presumably can throw up these payment scenarios - however 'unusual' they might be, you would have thought Equiniti and their lawyers to have thought the possibility. They are not beyond the realms of imagination and I am certain they are not unprecendented. All you points are right. What if the money had been used to dip back into CLLN - what would Equiniti be saying then?
Although the situation may be "unusual", liquidation is not unprecedented. You might have thought Equiniti would have had a contingency plan for such situations - and at the very least be able to point out in their small print why the settlement times are relevent when they stand to lose and not when they stand to gain. Now, where have I come across the idea of cr@p contingency planning recently? They are making it up on the hoof - "pending clarification from CREST/liquidator" my @rs�.
You make a fair point Cransy. The final impact on the taxpayer following no help compared to the estimated impact with some form of government support is a costing I would love to see. If, as you suspect and I agree, it costs more with the no help option, May and her bunch need to be held to account. The private sector 'mantra' is loud and clear over this one "we can't nationalise losses and privatise profits". But the reality is that profitable parts of the Carillion empire have gone to other firms in the private sector and the government and small firms are footing the bill of other parts in higher government spending or lost jobs. Someone needs to get their act together quickly on this one or it will happen again.
What actually was expected? For vanadium to stay low in price so that REDt could buy it all up? Upward pressure on price sounds very much like a market working to me - in fact, unless vanadium has been discovered to be the new viagra or can solve the world hunger problem, upward pressure might be an indication of interest in it because of what it can actually do in REDt particular niche market.
Probably that person has been suspended form the board - they were pretty obnoxious and used pretty much gutter phraseology people that was personal and designed to cause offence. That's what I would do if I was moderating the board - either that or an outright ban.
Regretfully it probably is. It might be able to be clawed back if charges of gross misconduct can stick. From Independent: The IoD say �There are some worrying signs. The relaxation of clawback conditions for executive bonuses in 2016 appears in retrospect to be highly inappropriate. It does no good to the reputation of UK business when top managers appear to benefit in spite of the collapse of the organisations that they are responsible for.� So the lovely, caring , sharing men get to keep their money unless: Previously the firm could ask for cash back if the business went bust but the revised policy said it could only do so in the event of gross misconduct or if the financial results had been misstated.
It would be interesting to see how the BBC would play it. For me the question is how HMG reckoned the choice between taxpayers money to pay for loss making obligated services once run by a now liquidated company (the situation now) and the cost of other options. Did the taxpayer win or lose and quite how much? Don't forget that the idea of contracting out and DLO was to save the taxpayer money. Oh yes, I trust very much that no-one in government has any friends, family, or part-time jobs on the board in Serco, Kier et. al.
@ FD - it was your comments yesterday about the free market that you made to me to which I referred, not to the person who was poking fun at the loss makers. But I am happy to let bygones be bygones. I agree with you about the the liquidation. Administration or D4E swap was by far the most likely - I said over the weekend I couldn't see HMG letting this go because of the ramifications of failure on wider public services. How wrong was I ? Not saying they did the right thing - just saying that I never believed for one second they would do such a wrong thing. The have painted themselves into a corner now. It never was a simple case of state versus private ownership. They have said they are continuing 'public services', though quite what they are now up for interpretation. They have used contingency measures to pass public funded profitable projects to other private firms whilst taking on aspects 'in house' that will cost the taxpayer shed-loads. No free market competition evident here - in fact very much the opposite.
You must be hungover FD after your rantings and accusations yesterday - not the sign of a sober person. I reckon you should put a vodka in your skinny latte mate - it'll keep your vitriol and snarling up to a high standard.
Its a political gamble. Whether or not contracting out and DLO should have been there is the first place is a moot point. The fact is that the 'stress' tests and contingencies were unlikely to be enough and the result is a short term and possibly longer disruption to public services. Bail-outs would have left the govt. open to the charge of nationalising losses but privatising profits. Which, funnily enough is what has happened. Just the profits have been shifted to CLLN competitors like Kier and the losses will be paid by muggins taxpayer. Bail out would have more akin to the East Coast Mainline - which was made profitable through govt. intervention ! It would have been nothing like the Soviet Union - pure fantasy. You may as well have said it would have been like the planet of the Daleks.
FD20. Don't put the crayons on your face mirror. If the heating is on they can get sticky and your powders might stick to them. If so, just carry on having the 3 cans of Special Brew per hour that your GP prescribed.
Newsnight hinted at the cost to the taxpayer of having to take on so many of the contracts that the JV partners won't / were not ever going to take over. Look forward to comparing the cost with the numbers mentioned over the weekend regarding bailout,