Member Info for Marcus_

Hi Finders, its all alearning game this share issue.

Given my time over again, I would have sold everything at 19p (I missed the 24p rise).
Then bought back in at 15p to benefit from the new share offer, then sold 5/9th of the shares at 15p (or 16p if you were lucky) the morning after the record date only to buy them back at 12p as part of the offer.

Sadly hindsight is 20/20 and instead I waited for the broker confirmation of my allocation at which point the SP was at 13p and all the smart cookies had done their business. Like I say its a learning game, some of it was my fault I was greedy I saw the 24p bounce and wanted some of it, so held on too long at 19p.

I think we saw that short happen on Tuesday on the 4150000 sold at 14.99p thread.

So if they sold at 14.99p it was about £622k worth of shares, if they buy them back at say 12.5p then its a quick £100k in their pocket, with very low risk of the SP increasing in the next 10 days.

Ah broker recommendations, the soothsayers of the modern age.

If I set my doubts about the authenticity and duplicity of "free" broker recommendations, then I would say that brokers are doing the same as we all are on here. They are looking at the company and stating what they think is a safe position for the next 6 months.

e.g. buy up to 30p

So its not so much a recommendation for today only, it has to cover all outcomes for the next 6 months. However, I do wonder how much faith you can put in advice given for free without charge. If they were spot on then surely they would be asking for commission or would run their own fund investing in equities.

I have been considering the position of shorters (I know I must not be right in the head).

Lets say they have sold at 18p with the share offer they probably predicted that the SP would fall to around about the 12p of the offer. So they could be buying back at this price.

But assuming they feel the SP can fall further they can they keep that short in place? I assume so.

My understanding is that they must simply buy back the shares at their end of their short to return to the party that loaned them. So post consolidation they only need to buy the equivalent number of consolidated shares as to those that they loaned.

So I'm not sure it makes a difference to shorters. The only impact would be if the loaning party wanted to sell the shares themselves. This would lead the shorter to having to buy back the shares, but the effect would be neutral as the loaner would then sell them again.

In short I'm not sure the consolidation impacts shorters to any significant degree. Happy to be corrected though.

What has helped shorters is knowing that the market is likely to priice the share close to the offer price.

Talking about volume, who buys 9 shares for £1.20. The trading fees alone must wipe out that trade.

I'm not sure how you can tell that you can't buy in volume unless you have an order in for 100000 shares. But I imagine few are buying until the market settles on a new price post trade offer.

Whilst I wish all those saying 30p -40p well, personally I can't see us hitting those kinds of levels without solid results.
I can see us continuing to drift between the 15p - 20p range for the foreseeable future until some results are published (or if you are a MM when you get the nod that results are improving).

I think if cruises are recommenced then we will be at the higher end say 19p-21p. But the main worry from the market is the debt and the cash burn. Many businesses go bust not because of lack of profit, but lack of cash.

The refinancing will help but we really need the ships to start to at least breakeven to take the pressure off and they can't do that whilst laid up in the docks.

I do wonder what proposals the industry has been putting to the government to get cruises going again. I would hope that they are beating down the door with ideas around testing before departure at the very least.

Whilst yes the company has been tied down with debt, the future of its income is for the moment out of its hands to control.

They crossed the threshold on Friday so not at today's levels.

To be fair this maybe a bit of a speculation as 3% seems fairly low to mount a bid, could simply see an opportunity for arbitrage, between the offer and sale price.

I was thinking that when it fell from 600p.

To be honest most of my shares are now bottom draw shares until the impact of COVID passes. The issue for UK shares is that once COVID is out the headlines we still have Brexit ready to hit.

We've had no good macroeconomic news for about 5 years in the UK. Everytime we get over one crisis, we seem to have a way of creating another.

My non-UK funds are going great, but UK shares are pants.

It will be 15x the sp on the closing date before consolidation.

It can't be done at a set price otherwise the company and not the market would be setting the price. Even if that was possible as soon as the shares went live the market would correct the new consolidated SP

The financial position is not at that level once the open offer is confirmed. You can read for yourself in the several RNS that debt will be cancelled and remaining liabilities renegotiated on better terms.

The falling SP in my opinion is holders looking to reduce their average. Depending on how many shares you hold this will become less and less worthwhile the closer it gets to 12p.

I can't see anyone selling below 12p, the real question is whether once the offer has gone through will the SP bounce back to 15p-16p or remain at 12p.

You don't go bankrupt from a low SP, you only go bankrupt if you run out of cash or creditors call in their loans.

The capital raise actively prevents both those from occurring.

It has certainly been an education for me as I have not taken part in a share offer like this before.
If I had my time again, I would have set a sell for the day after the record date for the number of shares I could buy at the offer price.

Waiting for the brokers to tell me my allocation has cost me 3p per share.

As they say life is an education and this is one more thing to learn about share offers.

Well percentage wise £4.88 per share is as far away from today's "future consolidated SP" of £1.95 (or 15*13p)
as 44p is away from 13p.

So it is no more difficult for the SP to increase by + 300% at either price as the SP is only a result of the market cap of the company.

What ever percentage increase you need in the SP to break even will be the same post consolidation, however I think Jed's point is that historically following any consolidation in a company under stress the result can be that the SP just continues to decline. Medium to longer term it has no impact but there is a risk that the market sentiment is that people see the SP and not the market cap and therefore equate the new consolidated SP to the old SP.

My average is about 18p so to breakeven I'm still looking at a 40% increase in the SP.

I think it is correct to state that the initial impact of working from home is either neutral or costly for service providers.
Where they stand to make money is if they can take advantage of the long term effects.

It is likely that home workers will start to see value in not just speed but stability of connection, if you are a company that can market yourself towards this then you may take market share from those where people get dropped every 30 minutes.

Also in terms of businesses they are going to be looking for effective and secure connections to their internal networks. Sure they will have some already but probably not designed to be scaled up to the the current levels.

Its not a certainty for any service provider to make easy money, but those who can market and prove themselves as successful providers of working from home services stand to take market share from those who are unable to deliver.

I don't get what the size of the stake has to do with someone's view on the company? You could have a very knowledgable person with little capital in the company or a millionaire for whom the investment is the same as betting on red or black.

Indeed some people post who are not even invested at all and their input and insight can be better than those who have invested 100,000k based on an emotional attachment to the company.

The buys and sells are iffy at best, so would not read too much into that.
Given the fall in price after the transaction it could well be a sell.

Is that good for you or not? Can't determine without knowing your buy price.

Well you IG people are ahead of the game as I've just checked my HL account and there is no option yet to take part in the offer.
So it's a case of wait and see for me.

Fair enough, like I say not sure about the value for money. I imagine the tight timescales may mean that any competition was limited.

I have no idea what value for money is on administering a new share issue, but I imagine there is some admin work in tracking down all the individual share holders and checking whether they have taken up their share allocations.

The big institutions will be the easy part but the small PI's will be were the leg work comes in, then I assume it also covers the cost of the consolidation afterwards. I've no idea if the people being paid also facilitate the discussions between the board and the major stock holders.

Either way its a little more than just writing a prospectus.

I've just been reading the prospectus today (well as much of it as I could bear, there are a lot of risks).

What I don't get is that the payment for the shares in the open offer (28th-30th September) seems to be due prior to the vote on the share offer in October.

Therefore, we will have paid money to SAGA (if you take up the offer) but if the vote was rejected there seems to be little information about how that money would be returned

Maybe I am being over cautious but seems the wrong way around, surely the vote should take place then the share offer issued?