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Thank you for sharing your thoughts on this. It's always good to hear other's too and not just ones own thoughts 😅
I certainly agree that Reid did not inherit a lot to work with.
I'm also not against this sort if incentives. Quite the opposite.
I just wished that for once we, existing investors, get considered first. A higher strike price or at least tying these options to some kind of performance metrics would be enough. Something along the lines: has delivered additional 200MW at MeyGen until X.
Anything that ensures we all see some returns and not just those with an average of 1.15p ..
Thanks OT.
May I ask you.. what is your opinion on those grants? I know you would have shared your thoughts if you wanted to, but I'm curious.
Again: Seeing them grant themselves bonuses that we have to pay for at the lowest price ever recorded in the history of the company does not feel appropriate to me. Especially since these grants end up being 15% of the company. Imo last year's grant was already a leap of faith. Providing such a ridiculously low strike-price may primarily motivate management so sell their shares asap. I'd much rather see them successfully increase the value of the company first, and then collect their reward instead of providing them these kinds of bonuses in the current setting..
> The general role of thumb under the circumstances is that they would not be allowed to sell them for at least one year.
The shares of their last grant vest over the next three years iirc.
> What I'm struggling to understand is if there are a few of us here with a few hundred k of shares and we've all been averaging down. Why has this SP remained stagnant?
This is not easy to answer. There's many reason why the share price would go down. One of them is good old dilution. Over the past years, said management has had many grants. I don't know how big those were but the last two make up 15% of the companies shared issued.
Now, as these shares vest, they are offered to the market and somebody, don't ask me who, buys them. Bear in mind, that those shares offered are already going to be cheaper. Why? Because that's how shares work of course. The more shares there are, the less a single share is worth.
In other words: Whenever one of us averages down, we are, among other things, paying for these grants/bonuses. Literally paying for part of management's salaries which is why these particularly large grants are a thorn in my eye.
Another big factor then is, of course, demand and supply. Simple as that. If people sell shares, they name a price, and they'll always ask for as much as they can. However, they can only ask for so much somebody is willing to pay. A simple market.
> Do we think these shares are kept artificially low for some reason?
Maybe..? If I was management and had some good news to share, then I'd wait until I have my grants - for example. I am not accusing current management of doing that, because it is illegal, but there is some control that it in the grey zone.
The BESS planning committe meets on Wednesday, 10th January, 2024 10.00 am. Just a few days after management has granted themselves a huge chunk of shares.
Coincidence? Maybe? Did they have any control or say over this? I don't know. Also maybe.
But even if not: The company has performed abysmal on the stock market so far. Leaving every single one deep red. So.. is it appropriate to grant management a huge amount of shares in this case? Based on what performance? Did we see an increment in revenue (not couting the one-time payment of course)? Did we see any value increment? All we saw was selling assets. ATES, Uskmouth..
Did they do a good job? I don't know. Maybe. Do I feel that the grant last year should suffice? Absolutely. Am I convinced that another big grant is appropriate? Not so much.. all I am afraid now is that they sell their options the moment they vest because it's not unlikely that SAE might see a rise in valuation.
Again: It is us existing investors who pay for these grants. It is our money. Yours and mine. It is my opinion, that we have paid enough already and that it's time that we see some returns, or at least break even, before management grants themselves new shares at the (almost) lowest price ever recorded in th
> I think all this chat regarding The employees and directors having shares given to them is talking the share price down.
Or it's the fact that management literally takes 15% of YOUR investment away over the next few years?
These grants are diluting shareholders.
The company has a market valuation of £10m. That is barely it's booking value. The company has barely any revenue and over 90% of investors are retailers.
I am not envious. I do believe people need financial incentives. However, Graham Reid, as an example, already has a base salary of £290,000. That's not too bad for a company of 20 people. Then, they've already granted themselves around 7% of the company last year at a strike price of 1.15p. That is, if the company ever reaches 11.5p, already a nice bonus for them of around £400,000 to £500,000. Also not too bad. Still, the company won't be worth much, should this ever happen. A market cap of £100m..
So now.. would they sell their shares or keep them? It's already a nive bonus .. but it can be more if the company had a higher valuation, right?
Again .. my biggest fear now is that they grab shares, pump the valuation of the company up as high as they can and then sell their shares back to the market causing the price to drop. And all that before the stock even reaches 10p.
What is happening now has the potential to make the current management millionairs without any of es break even at all. That is the danger that I see as they gift themselve large grants like that at a strike price that is at current levels.
Please think about this.
Thank you 🙂👍
Did you send the same content with an explanation? Would love to know what they answer.
I'm quite sure they can provide one and that they'll repeat the fact that they want to incentivise management..
I'm not sure if any answer can make me happy at this point...
I sent it via the contact form on their website.
I messed up.
I created a separate email-address for this email in order to remain anonymous.
However, now after checking if I got an answer from Simec, the site is now asking me to confirm my identity using a code they sent me via SMS.
The problem: I didn't give a valid number. That means I am now effectively locked out of said email-account. Unable to check whether or not and what SAE writes back..
Keltickilla may I point out to you that they did a switcheroo here?
Basically, they decided that the company is now worth so little, it's better to give away their old options and switch them for better once. Let's say... a strike-price of 1.15p?
Wouldn't it be nice if we all could just grant ourselves a much lower average? I am at 4.5p and I have to pay for this with hard earned money.
Seeing management making such a move TWICE within 12 months is too much.
How did they earn this? How does this match with the stocks performance? How is this in our interest?
I was able to accept the first grant which was already over 7% of the company.
Management is already in the green. They already see +20% in return as their strike price sits at 1.15p. Should management achieve a share price of 11.5p, then the'll receive a nice bonus of £300,000 to £500,000 already.
That's pretty neat and should be enough incentive imo to work towards this and hopefully even more some day.
However, all I see and fear now is them taking 15% of the company, waiting for some proper valuation in their perspective, only to sell their stock right back to us.
Yes, I want them to have an incentive to increase the value of the company, but with a strike price at 1.15p and now another at 1.5p, still down 99% since their IPO, how is this justifiable in front of existing investors?
Imo the simple solution here would have been to set a higher strike price. Their grants are not even tied to any other performance metrics whatsoever..
To whom it may concern,
I hope this message finds you well. I am writing to express my sincere appreciation for the ongoing efforts at Simec Atlantis Energy (SAE) and to address a matter of concern that has recently come to my attention.
As a long-term investor in SAE, I have been closely following the company's performance and the recent decisions related to share grants to management. I understand the importance of incentivizing and retaining key talent, and I want to give the benefit of the doubt that such decisions are made with careful consideration.
However, I cannot ignore the significant impact these share grants have on existing shareholders, particularly given the fact that many of us have experienced a substantial decrease in the value of our investments. Since SAE's initial offering, shareholders have faced a decline of almost 99%, which raises questions about the appropriateness of diluting our ownership further.
I am reaching out with the hope of gaining a better understanding of the rationale behind these large share grants and how the company perceives them as appropriate in the current context. While I appreciate the need to reward and retain valuable team members, it is essential for shareholders to comprehend the decision-making process behind such actions.
I kindly request an explanation that outlines the company's perspective on this matter, taking into consideration the concerns of existing shareholders who have witnessed a significant erosion of value.
I firmly believe in open communication and transparency, and I trust that you share these values. However, if my concerns are not adequately addressed, I feel compelled to bring this matter forward to the Financial Conduct Authority (FCA) for further review.
I appreciate your attention to this matter and look forward to your response, which I hope will provide clarity on the company's perspective and decisions.
Thank you for your time and understanding.
Best regards,
a concerned investor.
Here is what ChatGPT answers after asked if this kind of dilution would be mention worthy for the FCA:
"Yes, the significant dilution you described, especially without a corresponding increase in value or performance, could be a matter worth bringing to the attention of the Financial Conduct Authority (FCA). In your communication with the FCA, highlight the specific details of the share grants to management, the extent of dilution, and the potential impact on existing shareholders who have experienced substantial losses.
Be sure to provide any relevant supporting documents or references to the company's filings that detail these actions. Emphasize your concerns about the fairness, transparency, and alignment with corporate governance principles, especially if there is no clear rationale or performance justification for the large share grants.
The FCA will assess the information you provide and determine whether there are grounds for further investigation. Keep in mind that regulatory bodies aim to ensure the integrity of financial markets and the protection of investors, and they take such concerns seriously.
If you're unsure about how to present your case or need additional guidance, consider consulting with a financial or legal professional who can help you articulate your concerns effectively."
This does not feel appropriate. It would be an entirely different story if the strike price was significantly higher. It's unacceptable that they grant them another big slice of the company like that. The first grant was already hefty but I was able to accept it knowing this should motivate management. But pocketing even more shares at a strike price THIS LOW is absolutely inappropriate given how many investors are way, way under water imo.
This is what ChatGPT had to say: https://chat.openai.com/share/b9e92ec9-2e11-4ef0-a239-b0d79c0c48b0
It looks like the board of directors can do that only of they deemed it "appropriate" - whatever that means. However, it also said that shareholders have the final say and that this should be something that would require a vote during a GM.
Somehow I feel like these meetings require way more attention from us..
Tiny addendum:
The total number of shares will reach 843.15m once these grants are vested. 120.05m, the number of shares management granted themselves, represents 14.24%.
Don't get me wrong, long term incentives are important, but in the past 12 months, management has granted itself a total of 120,048,803 shares.
This is over 16% of outstanding shares (approx. 723 million)!
Once these shares are vested, we, the existing shareholders will have to endure yet another 15% dilution and that without any guarantees that management won't just sell their shares the moment they have access to it!
Somebody correct me if I'm wrong, but this is money taken straight out of the pockets of existing shareholders.
And it's not money that will be used to build new turbines. It is bonus money for management.
Simec will emit even more shares once the company requires more money.
I'm sorry, I thought last year's grant is already the long term insensitive which is already plenty should the stock reach that juicy £100m marker cap aka 10x or +1,000%.
But now seeing an even larger packet going in their pocket, without having created ANY value for shareholders as of yet, is an absolute joke in my opinion.
Here are the numbers:
Shares outstanding: 723m
Grants last year: 55.26m
Grants this year: 64.79m
Total: 120.05m
120.05/723.1 = 16.6%
6th of April 2023 they already implemented long term incentives. At that time I was already a bit skeptical but tbh..I rather have a financially motivated team than the other way around.
The company work at has plans like this as well.. but I have to vest my shares over 4 years and I can't just grant myself more shares as I see fit etc.
They've already put out almost 8% last time..
https://www.lse.co.uk/rns/SAE/grant-of-options-csop-and-ltip-k85o93rxi9f9iiy.html
Not sure if I like this
97% availability is indeed very impressive..
What I do not understand, however, is why not build a bigger array? MeyGen has proven the tech, so has the 500MW turbine. Why scale up so little?
I wonder how these things are conducted. If Proteus was able to build these turbines at a lower price, given large enough orders then, at some point, they must become a financially viable option.
Let's not forget that there's CfD money coming.. at some point we have to see the price go down further.
If Japan was to buy more turbines it would only help.
Am I over-reacting here?
Well, yes. And I am absolutely all in for giving employees long term incentives like that. However, most existing investors currently have an average way above 1.5p. My average is 4.5p and it wasn't cheap to get there..
Seeing the C-suite grabbing shares at a ridiculous price ... two times in a row .. is something I can't say makes me particularly happy.
If anything, then Cs have been incentives to keep the share price as low as possible as long as possible s.t. they can get grants like this.
It feels like stealing from us existing investors who have skin in the game for years now..