SURE - MFAI Comparison15 Aug 2025 07:34
MFAI - SURE comparison. part - 1
SURE is much less liquid when it comes to trading the stock. However it is a VCT & has slightly different rules to MFAI, on exits (liquidation of assets) it is meant to pay out the proceeds to its shareholders (other than retaining enough capital to meet its funding requirements etc) whereas MFAI can really do what it likes with the cash it receives, ie re-invest it or whatever & that is one of the key points for me when you think about the SVV1 being in EXIT mode.
So when SURE do payout 22.9% (1,816,790 shares) of it will go to MFAI who may or may not pass it on to its shareholders (bearing in mind the amount of future commitments it currently has @ £7.5M combined to SVV2 & SVV3) where as if you own SURE Ventures shares that payout will go direct to you to do with as you like.
MFAI has 526.66M shares in issue, its also granted 41.5M options to its directors, 13.7M of which have already vested with an exercise price of 0.25p attached. It has also granted a combined 88,672,617 warrants to shareholders with an exercise price of 1.6p. Both of these are dilutive to the NAV going forward.
SURE has 7,948,130 shares in issue, no warrants etc. So at the current mid price of £0.825 per share gives it a market cap of £6.55M against a 31/03 NAV of £14M or £1.75 per share.
MFAI effective has 540.35M shares in issue which at the £0.00875 mid price per share gives it a market cap of £4.72M against 31/12 NAV of £10.793M or £0.02 per share. However that understates MFAI's true value because it has to use SURE's share price not its NAV which it will be entitled to eventually meaning its understated by around £1.55M. Which would add on another 0.2p to that per share figure, however once the share price of MFAI exceeds 1.6p then those warrants are going to start being exercised & yes they will bring in extra cash, but they will dilute the NAV at the same time by 15% or more on the NAV portion above 1.6p
MFAI only has 3 assets it has any real control over low6 & precog ( SVV1 has a stake in Precog as well) & its SURE stake (which might be hard to sell & in doing so your destroying some of your own value). After paying off the loan notes it would have had around £1.7M in cash, but SVV2 & SVV3 will have had cash calls since then plus admin expenses. If there aren't any new exits fairly soon (by end of Q3) it might need to start thinking about getting more cash, either via loan/equity etc or sell down its holding in SVV2 or SVV3.
SURE has around £1M in cash but it to will have had cash calls on SVV2 to fund as well. However given SURE is the listed vehicle of SVV, it can to some extend control when new investments are made into SVV2 if need be. It also has a £1M loan facility from Shard available to it at market rates, so it has a lot more flexibility around its funding needs which are also much smaller than MFAI's.
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