Member Info for MrBWM

Does anyone have a view on what's going on with today's trades? It all looks a bit odd to me; big negative transactions and a series of 1 share trades (which is supposed to mean an RNS is imminent according to stock market lore).

…. writes the poster who said on 18th Feb that we'd reached the bottom at 6.5....

TB - as I feared you don't seem to understand what will happen if there is a sale of Nano. If there is a sale we will sell our shares to the buyer at whatever the deal price is - and that's it. We will no longer have shares in the business and we will no longer have any claim for whatever monies Samsung do pay; they will go to the new owner. The sale price will, therefore, have the buyer's expectations of future legal claims priced into it. The only way we will get a claim over any future legal proceeds is if the deal involves shares in the buyer or we choose to buy shares in the buyer ourselves as individual investors.

TB - I'm sure you realise that you won't get both the sale price and the lawsuit settlement; the sale price will have the lawsuit built in and you can only sell your shares once!

I'm not sure why coronavirus would slow things down; people can still watch TV (in fact probably more will if they're all in quarantine!).

Possibly, although I don't think Samsung will end up paying anything like $400mn to settle the case; with an amount like that they'd sooner let it get all the way to trial and then appeal.

There is a chicken and egg situation here. Without the IP there is no sustainable earnings stream (at present) and potential buyers won't know whether there is a valid IP until the court case is finished. I can't see a sale (except to a hedge fund or equivalent) until the court case is finished and in the meantime there are the recurrent costs of the business that need to be paid. I think anyone planning on making a quick fortune here is likely to be disappointed (but we can all dream!!)

Mike - Isn't that why NCYT has been topping the charts on here for a couple of weeks?

Jonesy - It may be valued at 25m but that doesn't mean that it's worth a penny to our business. To them it was a sunk cost (add your own joke here) because they'd already spent the money; therefore it cost them nothing to 'sell' it to us.

Jonesy - because 6p a share (or 4p or wherever this ends up) is still more than they paid for their shares.

Nige-W; how do you know the board wouldn't discuss offers below 50p? Is this based on information/knowledge or is it just a hunch? This is a company that has not yet reached commercial viability (it has never made a profit) and unless an income stream is found soon will need further cash injection to remain viable for long enough to pick up any 'winnings' from the court case. I'm not convinced the BoD are in a position to demand any particular price.

Maybe my maths is wrong but surely the claim was filed on 14th Feb so 30 days would be mid-March; 60 days takes us past Easter.

And their wallet!

8% spread suggests the MMs don't know which way it's going to go, and not much interest from punters either.

Troublesome; I accept your point. If the case gets to full trial there is 67% chance of a guilty verdict based on past experience in that court. However, PPE used the term 'guilty' and I would still suggest that there is a 98% chance that Samsung are not found 'guilty', mainly due to the likelihood of an out of court settlement.

PPE - the key section in your message is 'assuming Samsung are found guilty'. If the technology used by Samsung is not Nano's then the rest of the claims for IP value do not hold. As for guilty; there is a 2% success rate for claimants in the Texas ED and they only uphold in full 42% of their own decisions on appeal (and we know from past experience that Samsung would appeal).

TB - Why would the BoD only accept offers above 42p? A quick examination of the most recent director buys shows that they were at 12-14p and, going back further, very few buys were at anything like 42p.

But who would want to buy Nano? I can't see a firm buying Nano as a commercial 'dot producer' with the costs and risk of the legal case hanging over everything. A hedge fund or similar investment vehicle with a high risk appetite might go for it but they won't enter a bidding war for the privilege. Samsung might do 'the honourable thing' but as PPE has been keen to point out their ethical track record doesn't suggest that they will. I think they will hold out for as long as possible (and it is worth noting that the Texas ED court only uphold around 42% of their own IP decisions on appeal). The Chinese might want the IP but they are generally conservative in their investment decisions and probably wouldn't want the uncertainty either.

Wouldn't a breakeven financial position mean no dividends would be paid? This would mean the shares would be effectively worth nothing (aside from possible dividends earned from completely new revenue streams). A sale would seem to be a better result for current shareholders to me.

Ddubya, I have heard the same advice. However, some brokers won't let you put a selling price above a certain percentage of the current price and this restricts the possibility of doing this.

Coffee cups is about as much oil as has flowed! How many cups make a barrel?

There are the costs of the case itself but the bigger issues around a loss in court would be (i) possible counter-suits by Samsung, which could be very (probably terminally) expensive and (ii) failure to protect IP, which would indicate that there may be little value in the company given that the IP is their most valuable asset at present. Any company buying Nano at this point will want to weight the risks and potential pay-offs against their own risk appetite.