RE: Up 25%....1 Jul 2024 20:12
SOU appear to me to have failed to RNS a partial loan note conversion between 1-Sep-2023 and 31-Oct-2023.
The RNS of 1-Sep says "The Partial Conversion reduces the amount owing on the Convertible Notes by £500,000, with £1,500,000 remaining."
That of 31-Oct says: "The Partial Conversion reduces the amount owing on the Convertible Notes by £500,000, with £500,000 remaining."
There's £500,000 missing which does not seem to have been RNS'd. We have partial conversions from Jul, Sep, Oct, and Nov '23, and in Mar and Jul of this year. The conversion in Sep 23 was on the first of the month and might have been notified before Sep. That would put it in Aug calendar month allowing an additional conversion in Sep which looks not to have been RNS'd. (There is a limit of 20% of the original loan amount per calendar month, i.e. £500,000). The total number of shares across the partial conversion RNS's does not add up to the total change in the share register, again suggesting that an RNS is missing.
It looks like the note holder was anxious to convert as quickly as possible in 2023 until Calvalley went sour. Now that Managem looks to be a cert, they are busy converting again. I expect to see another 50m shares issued in each of the next two calendar months.
While the conversion price on the original loan amount was fixed at 2.25p/share, the conversion on interest is at the average of the last few trading days, allowing the interest amount to be converted for ~1p/share. And since all the interest becomes payable (i.e. 5 years at 15% pa) upon conversion (who the hell agreed to THAT?) there is a ton of money to be converted at the cheapest share price. It even seems to be possible to convert the interest BEFORE the original loan amount, to avail of bargain basement prices. Shows that a struggling company can still be a nice little earner if you have the connections and are not the perennially-shafted plebeian type of retail shareholder.
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