Whoever backs Phoenix must be cursing their investment in this company at the moment. Pouring in £19.5m for a 58% stake might have saved SGI at the time, but with the shares at 2.15p at the moment, the whole of SGI is only valued at £9m - less than half Phoenix's investment.
That alone should make everyone sit up and look at the share price. You can currently buy these shares under the price even Phoenix paid for their stake. Once reality returns to the shares, I cannot see how the price will remain this low. Presumably Phoenix based their investment on an expectation that the company was worth £34m [=8p a share], logically they believed it was worth more in the future - say £50m - £75m [= 12p - 18p a share] hence their investment. The only surprise I suppose is that they themselves are not buying up further stock at the moment. For shareholders, it is a great shame the shares aren't performing like ARB which has risen from 2.5p to 10p recently.
Carpe, they are badly oversold, with no analysts covering them, not on the radar of any city institution, and not tipped by any Sunday paper for years. That is the result of the mismanagement back in 2015 - 16 and the change of management and losses that were crystalised in 2017 and 2018. Management now need to show they are investment worthy again - hopefully this will start to become clearer with next month's update.
The reorganisation must be largely over, and whilst the shares remain at this pathetic level, the upside is colossal. I must admit I am keen to know what the major announcement is, all will apparently be revealed at Stampex next month. Looks like September is going to be a lively month which will be a considerable change to the rest of the year. Currently no analysts are covering the shares, in fairness, the company was such a basketcase in 2017 that it was not investable. I believe that has now changed, perhaps we will see the shares rise to around 5p by year end? That would still only value the equity at £18m which is less than Baldwins is worth on its own. I think the whole company is probably worth over £50m but it will need to start moving into the black again before that sort of valuation comes through. However, it would equate to around 12p a share. As I say, the share price at the moment is nothing other than a bargain.
Do these Turkish or Russian buyers understand that there’s no little point in buying the shares? To get to the deal table they need to be buying the bonds otherwise bond holders can easily ignore them just as they did with Debenhams
Talk about history repeating itself with what may be a similar outcome for current shareholders
Neset Kockar not buying up the bonds07 Aug 2019 09:38
With the 2022 6.25% bonds still trading around 30% of par it’s pretty obvious that Mr Kockar is not buying the bonds up. Now that shows he’s not a sophisticated investor and is failing to see the importance of the bonds in the timescale left. Buying the bonds would give him real leverage in discussions on the refinancing - you cannot just buy a share stake as bond holders don’t care less about shareholders and the bond holders come first
I hope for everyone's sake that he's not the Mike Ashley of Turkey. This could be like Debenhams where we were all suckered in and the price rose sharply a couple of days before it was suspended. Nightmare for everyone.