The Nonsense Master26 Nov 2024 16:56
Alma,
I hope you don't mind me reposting but the following might enlighten TCM. He seems to be mentioning Navitas "shares" a lot for some reason. I'll add it to the list of things he knows nothing about.
Chatham House
Rules of accountancy
FPSO's
Chess
"For those who advocate a Navitas all share takeover, be careful what you wish for.
Navitas Petroleum LP is NOT a company with shareholders who own shares, it is a Limited Partnership with partners who own Participation Units (a mix of loan and capital). The Units are traded on the Israeli TASE exchange. So, it’s basically, what we would call in UK, a special purpose retail venture capital trust.
Unit holders will never get a dividend, nor will they get a vote. They are limited partners who assign all managerial decisions to a General Partner, in whom they trust but don’t control.
The end game of all venture capital LPs is to manage the growth of investee companies, such as the operating companies in Texas and UK for Shenandoah and Sea Lion and sell them on for maximum profit at the right time.
Such profit is accumulated and distributed to partners when the LP is eventually dissolved. The trick is to pay off the loans first and treat the excess as a capital gain rather than income. This has favourable tax treatment is Israel, but less so in UK, where HMRC are trying to align income and capital gains tax rates.
Navitas LP is not in this for the long-haul IMO, it’s not in their constitution. It’s like the Glazer Bros at MUFC (Thank God for Jim Radcliffe). The General Partner team will have substantial carried interests which only pay out upon dissolution of the LP, and they will want them paid out.
Do you really want to swap your RKH shares for Participation Units in a far-off land on an exchange which you don’t know how to trade?
The ghost of Ken Dodd will know better, of course!"
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