Member Info for ManyHappyReturns

If you put yourself in the preference share holders and assume it's now 2036.

The SP would have to be close to NAV & BoE interest rates would have to be under 3% to even consider not taking the cash.

Neither of the conditions would be detrimental to shareholders.

The SP would have to be above the NAV in 2036 for preference shareholders to convert into shares, unlikely currently.

The BoE base rate would have to go close to 0% to consider buying back the preference shares in 2030, also highly unlikely.

So all we're left with is the NAV being marked down on paper, while the company is still making money.

The dividends might have been reduced but paying off the debt by £5m a quarter can't do any harm.

I would have thought that £200m preference shares should have their NAV adjusted.

As things currently stand they will mature in 2036 and given that 10 year gilts are currently 4.9% YTM and i'd expect at least +100bp.

This would value the debt at below £180m but i can only assume this doesn't fit their agenda.

It seems strange that the board would recommend accepting this offer at a discount to NAV.

They need to have 75% acceptance and as the board only have a meagre 0.03% stake that doesn't seem a foregone conclusion.

Also they mention the offer price in relation to November 4th closing share price which coincidentally fell out out of bed during the previous fortnight.

There was either a lot of guessers or someone had their snout in trough.

Either way there is a bad smell to this.

It will definitely help if they take up a larger stake. Saw this article from September which might be related.

https://www.hedgeweek.com/saba-capital-plans-active-etf-targeting-discounted-uk-investment-trusts/

Goldmans downgraded Ithaca to Neutral on 23/01/25 and the price was 1.29.

Hardly a recommendation for their analyst especially if it's the same one.