Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
155m voted for
125m voted agaisnt
80m volume since the sale announcement in Oct
41.5m volume since vote on 11/1/24
There lies the simplest reason why it’s at 3p and plenty of buying is being absorbed.
Simple market mechanics Let it churn, let the asset sale happen, it’s not just a day trade, plan was hold to end of Q2 or a rally.
Worrying to much about the short term book while it’s at £10m mcap from £250m mcap as point of asset sale rns.
Details are in a table in the endnotes of 20th Oct 23 RNS, 80 cents nav post transaction.
Minus any new losses / increases in associated costs etc since.
The goal for RQ is a mass deleveraging and move to fee based income to hedge against future risks which may include further asset sales.
The Losses are expected as part of the DD / auditing of assets given changes to market, just a matter of how much.
It works for Onex because they raise capital and buy assets.
It doesn’t work for RQIH because they have debt to fund the asset and higher interest rates put RQ at risk if held, hence deleverage.
The assets for sale are forecast to generate $100m free cash flow / year for next 5 years, it’s a no brainer for onex. And unfortunate that rq has to sell them. But it is what it is.
“Onex Partners and ONCAP. Similarly, in Credit, Onex raises and invests capital across several private credit, public credit and public equity strategies. Onex's investors include a broad range of global clients, including public and private pension plans, sovereign wealth funds, insurance companies and family offices. In total, Onex has approximately $50 billion in assets under management, of which approximately $8 billion is Onex's own investing capital. “
5.5m volume, quite a big day for a normally quiet RQ.
Actual values are : 3.03 to sell and 3.12 to buy, indicated spread is always wrong here.
I took it straight off the RNS, obviously minus any additional new losses as they tidy up the books for sale, but when it’s 3p / £10m mcap they have the small wiggle room of £220m and it would still be worth double.
Yep, if asset sales complete from 3p it’s got clear blue sky potential.
Post the $465m sale : “Net Asset Value Per Common Share 80 cents “= £240m NET assets, from £10m mcap there’s plenty of headroom for an increase in the £15m allocated closing costs and whatever losses they post.
+ The $30m disposal last week adds on top of this.
Also - the losses will reduce the tax bill, and could even potentially incur a tax refund for past taxes paid.
Just needs sales to complete.
“R&Q currently expects closing of that sale to occur in Q2 2024. In the meantime, the Board of R&Q continues to evaluate any and all options so as to realise value from its Legacy Insurance business for the benefit of all its stakeholders, including its shareholders, whether that be through the ongoing trading of that business or through alternative strategic options.”
Back to the last months advertised spread games, 2.71-4.00, last trade 3.2p.
Actual buy price : 3.184p
Actual sell price : 2.95p
Guess that makes it hard to spreadbet on from lows.
Expected a bit of a bounce today if im honest.
I did same, added more on Friday, now have buys ranging from 2.86-7.14p.
Would think $500m proceeds from of asset sales coming our way Q2 2024 would move the dial in the right direction upon completion..... but until then zzz
The GM is Monday, last day is 26th.
Up to 25p, dipped back to 17.8, looks to have respected the all time POC on the charts, which was 23p.
Beautiful trade Laura, very well done
23p is all time average price. Could well carry on as little volume needed to move it, tbh I’m quite surprised they managed to rise it this slowly and controlled.
If atom shares are used to secure the loan Theres still Net $12m coming in, and still only £2.5m mcap, (and that ignores the other assets) its worth much more to Peter than anyone else.
Still going, 18p paid, and the trading patterns of the week continue
Last I see was it mentioned in the interims, targeting 150%
“In June 2023, we raised $55 million of preferred equity, which was used to capitalise R&Q Legacy in order to provide reinsurance coverage to Accredited under the legal separation that was required to maintain the AM Best rating as well as for general corporate purposes. As a result, our Group Solvency ratio at 30 June 2023 was 169%, which is above our target level of 150%. Our total debt at 30 June 2023 was $333.3 million, which includes a bank facility as well as subordinated notes. In addition, we have $188.8 million of unsecured letters of credit that provide security on assumed reinsurance of legacy exposures, which are guaranteed by the Group. ”
So if this sale achieves “return the capital solvency position back to target levels” then it’s a good thing right ?
Target 150%
“The Sale will enable the Board to undertake a material financial de-leveraging of R&Q and return the capital solvency position back to target levels, “
If their solvency position target is above solvent then Sorely this is a good thing (price considered)
Watching the bid and its auctions it feels like many stops / spreads knocked out
Can buy at 3p now.
Not sure if bottom, but moved up to 3.08
Long auctions
Good or bad what we think, further asset sale but report significant losses
That will do me, saw 15p printed.
As I said I don’t want to hold the delisted stock, Has legs for more but a trades a trade, will watch and see what happens next.
Lol oops got my date wrong, GM Monday, 15th
Something else in different co was today.