Member Info for recklessferret

d.
Thought I had counted remaining characters, but no.

Here you are Appychap Slightly edited from Stimes Oliver Shah "TS Eliot offered to show readers of his epic poem The Waste Land “fear in a handful of dust”. In the past fortnight, debt markets have shown us fear in a handful of dog food, potash and spark plugs.
Metro Bank, chaired by the pooch-loving, governance-shy tycoon Vernon Hill II, failed to raise £250m of senior bonds, even at a yield of 7.5% — sending its shares crashing by a third. Sirius Minerals, which has been digging for fertiliser beneath the North Yorkshire moors, admitted it had been unable to lay hands on $500m (£406.8m), also prompting a collapse in its share price. Aston Martin, the car-maker that confuses itself with a luxury brand, managed to secure $150m, but was forced to pay 12% — which will rise to 15% if it wants a further $100m.
You might argue that each one is a unique case, but since the start of the year there has been a quiet bifurcation in lenders’ tastes. In this super-low interest rate environment, with money earning next to nothing in most banks (and even losing a small amount in some), steadier companies continue to issue junk bonds at 3.5% or less. It’s a different story for riskier prospects, which are increasingly being forced to pay double-digit interest rates or pull issues altogether.
Bankers reckon this more “selective” market is being driven by concerns over Donald Trump’s trade wars in America, Brexit in Britain and the slowing Chinese economy’s impact on Europe.
You might question how significant this is: debt investors always worry about getting their money back, while equity investors wonder how many multiples they will make. Lenders are naturally more conservative beasts.
Yet in the past few months, we have heard the hissing of air coming from the equity side of the tech bubble that has propped up the American market.[....]
Metro Bank, Sirius, Aston Martin, Uber, Lyft, WeWork: these are the kinds of “moonshot” companies that had investors queuing around the block (or mine) two years ago. Most are now in a state of distress due to lack of funding. In both debt and equity, risk is going out of fashion; fear is back in vogue.
This is likely to be self-perpetuating. European Central Bank president Mario Draghi fired his farewell bazooka this month, vowing to buy €20bn (£17.8bn) of bonds a month from commercial banks to pump money into the system. As investors swerve risky assets more and more, this stimulus is likely to trickle down towards safe havens and solid corporates, rather than growth stocks that could fire up economies.
There is an undeniable end-of-cycle feeling in the air. Will we look back on WeWork as 2019’s equivalent of the Bear Stearns hedge funds that were shuttered in 2007? Anyone who is unsure should remember that a handful of cash always feels better than a handful of dust."

Great last sentence, huh? Am I buying more on Monday with my own tiny handful?
AND my QUESTION Is SBR presently carrying on regardless as planne

CONTD
So I revert to the General Export Facility .Operated by the Government's UK Export Finance, who's mission statement says “Our mission is to ensure no viable UK export fails for lack of finance or insurance, while operating at no net cost to the taxpayer” Under its webpage heading of Success Stories it states “We support exports for any company size and across all sectors” Great! Lets ensure Sirius Minerals does not fail then.

ATB RF

I try not to post on things of which I no little, such knowledge being a dangerous thing etc etc. But we are living in dangerous times, so here is my take on HM Gov participation:

First, what is the EU position?. We are still IN, so this is important. Thanks to PAAA's referral to a relevant research paper we have the answer:
“The purpose of this paper is to examine the precise legal relation between state aid and EU funding and explain when EU funding falls within the scope of Article 107(1) TFEU which declares state aid to be incompatible with the internal market.
In summary, a transfer of state resources in the meaning of Article 107(1) occurs when the state controls the resources in question and decides how to dispose of them.
In particular, state resources are transferred in the following circumstances: 1....2....
3. A public authority [eg Gov Dept] accepts a liability without charging an adequate fee that can offset the risk of that liability such as, for example, a sufficiently high guarantee premium or rate of interest.”
So provided the fee is “adequate” to the risk, it appears that loan guarantee assistance under whatever Go. Scheme IS perfectly permissible.

Second, here is a recent eg of application of the newly expanded Export Guarantee scheme: ( Telegraph 15 July) The Government will guarantee loans of £500m to Jaguar Land Rover after Britain’s biggest car maker said it would develop and produce new electric vehicles in the UK. The guarantee is being provided by UK Export Finance, the state-backed credit agency, under a new “general export facility” intended to boost exports. It will be used to underwrite a £625m loan facility that JLR has secured with commercial banks, with the taxpayer-backed support being used if the car maker defaults on payments.
How this could square with Sirius' new financial plan I don't know, but it has does demonstrate a precedent for a new “facility” for exporting PLCs to take advantage of, and a precedent for its recent application, ie Jaguar.

Third, this does contrast favourably with the IPA scheme, which I appreciate Sirius did receive “pre-approval” status, but in reality if one has regard to projects actually funded they are all very much “State related” for the purposes of Defence, NHS, Energy, major transport, all no doubt involving PLC's but not being directed at an end result of producing a product to be within the private rather than public sphere. There may be exceptions, but frankly there has always been discussion of how Sirius (bar possibly the Port) was Infrastructure, and whilst clearly a major project, as I say it is not a major project for the purpose of public utility, even if its product will help this country's trade balance and revenues. CONTD

PART2
"Whether prospective investors share this optimism remains to be seen. BHP has its own $8bn fertiliser project in Canada. Fraser said Sirius had held talks with several mining and fertiliser houses over the years, but had never before run a formal process. He did not rule out selling a majority stake.
Gina Rinehart, the Australian mining magnate who is backing the project, has said she has no plans to raise her $250m. stake. Other backers, which include the Qatar Investment Authority, are “supportive”, but are waiting for the company’s review before deciding “what role there is for them”, Fraser added.
Any new strategic investor could further batter Sirius’s private investors, who have already lost tens of thousands of pounds. About 25,000 of them live in Yorkshire and the northeast.
Fraser suggested some may have been badly advised when deciding what to invest. “We take the responsibilities we have to all of our shareholders incredibly seriously and that creates a huge drive behind us,” he said. “In terms of where people have overinvested or probably not taken the right investment advice . . . I feel very bad for those situations, but we have been very clear about the opportunities and also the risks.
“We have been very successful in overcoming some significant milestones along the way and we remain confident that we will overcome this one.”
With cash running out and no sign of a saviour, how many would share that confidence?

Sunday Times today. Might as well read the whole aricle -it cost me a £3 subscription! PART1:-
A mile beneath the Yorkshire Moors up to 1,200 miners have been digging for more than two years, toiling to access vast seams of fertiliser.Last week they hit an immovable obstacle on the surface: Sirius Minerals, the company behind the $3.8bn (£3bn) potash project, failed to raise $500m of bonds. With only £117m in the bank, Sirius began laying off staff at Woodsmith mine near Whitby, North Yorkshire. Round-the-clock working will be cut to a 12-hour day shift to give Sirius an extra six months to try to raise the $2.5bn it needs to finish the project, the UK’s first deep mine in 40 years. The prospects are bleak, however.
Once hailed as an economic revival for the northeast, the project risks becoming a scar on the moors and leaving a trail of financial destruction in its wake, including 85,000 investors who pumped cash into the project, but have seen their shares plunge in value by 85% over the past year. They collapsed from 10.1p to 2.1p on Tuesday before recovering slightly to 4.3p by the end of the week, valuing the company at £290m.
Denis Kane, a 48-year-old gas pipes engineer from Durham, spent about £56,000 on 200,000 shares in the project, in the hope of retiring early.He said: “I had been working away from home and was hoping to be near taking an easier job in a few years, but I doubt that now.“If they don’t get the funding, I’ll have to work away again for any chance of early retirement.”
The failure to issue the bonds was blamed on market conditions, including Brexit uncertainty, though the project’s costs have always made it a tough call.
Sirius’s plan, several decades in development, is to sink two shafts to produce up to 20m tons a year of polyhalite — a particular blend of fertiliser currently produced only by ICL’s Boulby mine near by — and a 23-mile tunnel to take it to Teesside for export.
Sirius’s chief executive, Chris Fraser, an ambitious Australian, and his team are now reviewing the project, trying to find ways to reduce risk and costs and bring in new investment. Options include attracting infrastructure funds to finance the shafts and tunnel separately, alongside a big mining house such as BHP or an agricultural business.
“I am confident we will get through this,” he said. “That doesn’t mean there isn’t a risk, but I am confident. We have an excellent project.”

Shares and HL sites both confirm
16:40 - 20/09 Buy 10000000 4.32p £431,816.00
16:32 - 20/09 Buy 6000000 4.32p £259,125.60

Don't know what conclude- just saying both sites have these as large Buys
RF

Been in this project since 2012. Everything promised by the Board as regards development has, with some necessary adjustments, been achieved. On all the sites, construction has exceeded expectation. Involvement of the local community, and businesses wherever practicable, has been exemplary. Ditto the company's PR to shareholders and public at large, evidencing a world class construction project. So why would I not increase my financial commitment over the years, until that stake became far larger than I initially expected or intended? Does all this resonate with a lot of people?

So now there is a finance problem. We have had them before- Stage 1 was not quite what shareholders expected, but we accepted it in the end. Similarly, Stage 2 dilution was a disappointment, but I think not entirely unexpected given the delays in the pre-JPM plan A.

All I wish, as a so-called LTH averaging about 20p, is that the CEO and the Board, when considering how to proceed and complete this great project, does recognise and acknowledge its loyal private shareholder base which has enabled the Woodsmith mine project on the ground to get to where we are now.

So that the apparent PLC trend of abandoning shareholder interests in the meat grinder of required further financing is not in this instance followed, and that Sirius Minerals conducts itself as honourably, professionally, and dare I say innovatively in giving its long suffering shareholders a fair crack of the whip. Few of us have been in this for a fast buck- note the number of times people have referred to their SIPP investment and dividends. All most of us are asking, I think, is not to be wiped out as the sacrificial lambs. Is that too much to ask?

ATB to all and LTH's in particular RF

Hi hairyhoff. Yes well, not much of a joke in the first place. Note what you say about Fbook- will take a look, thank you. As regards FSCS, I have to say compensation on those lines would be amazing- but in all senses of that word imho. The admin costs of the liquidation will be covered, as established in the Beaufort Securities similar case 18 months or so ago. I guess it would be helpful to check out if any other compensation for "losses" of the type we are talking about was claimed/ paid out there. I must say I have severe doubts, for a whole number of reasons to do with establishing what any investor would actually have done, had they had the opportunity. I have a very few SXX. L with another broker. I still hold these. Would this indicate that I would not have sold any/all of my large holding with SVS? To be honest, I do not know myself- that decision has not been available.
ATB RF

Hi Hairyhoff
Sorry, my attempt at irony seems to have rather failed. Brokers SVS Securities were put into Special Administration by the FCA in early August. All SVS business, even the execution only accounts, were immediately suspended from operations and accounts "frozen". I contacted the Administrators about something else, and I mentioned the SXX situation as an example of then problem caused by the removal of access to my shares . This is all they replied "Thank you for your email. Regrettably your online account will remain locked during the Special Administration. " My reference to January is because no release of shares, probably by transfer to custody of another broker first, will be done until a Court Order is approved, and that will be "in first quarter of next year" according to the Administrator. Link for further info is https://www.leonardcurtis.co.uk/SVS/. If that link is removed, then go to SVS website and there is a referal note to take you there. Personally I think the FCA have behaved outrageously in freeezing thousands of trading and ISA accounts for months, with no recompense for clients who would have mitigated losses but cannot sell. However, there are only so many things one can be actively outraged about at any one time, so this one is on the Ferret backburner at the moment.
ATB RF

The obvious explanation is that he is just the latest convert to Chesh's irresistibly marketed SubsClub :-“iron out SP highs and lows to provide a safer, more stable investment”.

And on that note, I am pleased to be able to advise that through the cunning utilisation of SVS Securities (in liquidation) I have arranged with the FCA to have all my SXX holdings frozen until at least January, thus avoiding all those “shall I sell/ no, lets wait and see how much more I can lose” dilemmas. Has anyone else been this astute I wonder?

As regards Gov guarantee, I can see the merit of all the pro and con arguments. What does p me off though is the way the IPA involvement has been dangled over us, and indeed the idea of support used by the politicians for their own benefit when it suited them, when it now seems it was quite likely a non-starter from the off. Hope I am wrong on that- its very confusing. Did Jaguar £500m guarantee to build new plant under Gov Export Funding scheme need/get EU approval for instance. Would IPA funding for Sirius need EU approval? Could we apply for funding under Export Guarantee scheme. I have tried to research this but its all very vague on Gov webpages.

Lastly, what I don't understand is how we could manage to place $400 million of bonds (admittedly convertible) in Nov 2016, when all we had was planning permission and some rather nice moorland, and yet we cannot now raise only 20% more that that when the project has advanced so far and is going so well, the product has been proved through research and ICL, and we have the TorPs to prove demand. What am I missing?

All the best to everyone, RF

(Ex BBC News website):- " Robert Goodwill, the Conservative MP for Scarborough and Whitby, said it would be "unprecedented" for the government to step in:
"I hope they will be successful in finding a partner, I think that is the best way forward," he said. "The government looked at it and said it wasn't the sort of thing it could do, it is a commercial project and if it is a viable project then other companies will back it."
Gee thanks Bob- we all knew you had our backs with the Gov.

Sirius website showing new vacancies posted today 8 Sept for engineer (DMC) and electricians (Strabag) and other support positions (SM and DMC). Total of 6 types of position, some multiple vacancies. So it goes on, 24/7, with confidence.
ATB RF

Crikey GK. The Ferret family is only trying to make a few bob out of supporting North Yorks industry. UNDESERVING we may be but I had not actually realised we were trying to prevail as well. Come to think of it, how does one go about prevailing all over the place anyway?
However, the main purpose of this post is to report a superb yesterday out at the Skinningrove seaside- home of the now bizzarely but fantastically rescued British Steel works, thanks to Johny Turk. It has the most beautiful unspoilt beach in front of a small peaceful and humble village which serves the BS works; nowt but friendly and relieved looking folk, sunny blue skies, a North Sea warm enough to swim in for 20 mins, and great fish and chips for a fiver after. Then on the way home, passing Lockwood Beck on the A171- only a glimpse but clearly a hive of industry-the collective Ferret heart swelled. All that and Headingley too. What a great Yorkshire weekend. Onwards and downwards.
ATB RF

LostinTheCasino-hi again
Agree with all sentiments of your16.09 last para. Tried both- both equally rubbish.
RF

Hi Lost
Thanks for the revision info- I was working on aproximates of known institutional holdings which I reckoned were about 30% but happy to be corrected. The principle remains much the same. I had assumed that we were proposing this Retail Bond thing as an alternative to the JPM offer in September - not as a last ditch attempt to save the company when the JPM offer had definitely failed. Frankly I could not possibly input over 50% of my holding even if I wanted to - and I doubt anyway that Mrs F would let me live to find out if it had worked. I suspect I am not alone in this sort of scenario..
Regards RF

7.1 billion shares. Say 30% ii, so 70% PI held, = about 5 billion. 85,000 shareholders . Thats an average holding of 58,824. At lets say 20 pence paid, Mr or Mrs Average have shelled out £11,765. But we know that lots of people have invested far more than this, so it follows that a lot of people have invested far less. . But if I had the average holding, now worth £5,824 (using 10p current sp, for convenience) I am by no means sure I would feel the same way about a further commitment of double that investment value. And of course that is the AVERAGE holding- a lot of people will be looking at a shareholding now worth £2K to £3K on paper. So the question to akk, it seems to me, is whether those of us who are heavily invested could make up for investors who are not able or willing to put up £5k. Personally I would be happy to consider a £5k bond. But £10k, or £15k, or £20k - hmmm! I would like to think this could work, but I just don't believe that there is the time left to spend on such a truly speculative diversion. By all means lets continue the count here and prove me wrong when we get close to to 45,000 people averaging 2 x £5k each. But until then, I am not sure that CF or the media needs to be troubled with this. I do think such a Bond, retail or otherwise for shareholders and the general public could be a great idea to offset future expenditure, eg limited and manageable cost overrun due to a specific unforseen issue, or for capital invement on some "improvement" offering future value, but frankly, I don't believe its time is now. I have written to my MP Chief Treasury Minister Sunak about the Guarantee, last seen posing up to his neck in River Swale flood water for media purposes, so he clearly has time on his hands.
Anyway, the SBR is here, construction continues apace, the JPM bond offer will I am sure succeed by September end.
And in the wise words of a ferret relation, currently appearing at all good cinemas now Hakuna Matata!!
ATB RF

Couple of points. Not cos I am an expert on broker liquidation- just spent Monday shting bricks and doing some research:-
The £50K comp limit was upped in April to £85K per private client (£150K for joint a/c's) That limit is probably not very relevant because the only "loss" likely to be incurred is the cost of theliquidators admin, ie working out and confirming the Client holdings and getting a distribution confirmed by the Court then transferring funds to a new broker. In the Beaufort Securities case i mentioned, these amounted to £10K per private client, and the FCA/ FSCS compensators agreed to pay PWC the administrator, direct to settle their expenses, so no actual detailed claim had to be lodged to FSCS by individual former Clients. The real potential downside, which cannot attract compensation, is the "loss of opportunity" to trade your SVS portfolio up to a fortune over the coming few months. Personally, I am strangely unworried by this loss of opportunity!
ATB RF

Hi Bounty. Very sorry to note your understandable anxt. I held a helluva lot of SXX and some other stocks- almost all my lifesavings- in SVS, so it has not been a great week so far for us has it?!! Anyway, the answer is that SVS went into Specila Administration after the FCA served notice that it required SVS to cease "regulated activities" (ie inc. managing yout stocks) last Friday. Administrators have been appointed. Go to https://www.leonardcurtis.co.uk/SVS/ for info. Points to note: 1. Your shares are protected in SVS "Nominee" accounts. 2. FSCS compensation will cover you for up to £85K of any losses (eg admin costs of Administrators, which apparently can be claimed from SVS CLIENTs. That should £85 k per individual sholder should be far more than required. 3. It is possible SVS can be sold as going concern- administrators are inviting offers. 4 If not, likelihood is that SVs client holdings will be transferred top a new broker- this will take weeks. could take months. 5. In meantime, you will not be able to trade or sell your holdings, or get divis and any cash returned, but those will ALL BE ACCOUNTED TO YOU IN THE END- that is what happened last year with Beaufort Securities- you can Google BS for the whoe story- it took about 6 months I think for shares accounts to transfer to The Share Centre broker, at no cost to sholders. The FCA/FSCS sorted outt he admin costs with the Administrator direct. The Share Centre allowed a 3 month window for yoo to transfer on to a broker of choice at no transfer cost by the way.
Hope this helps a bit to reassure you. The Administrators site gives info about what will happen next.
Frankly in light of todays RNSa I am rather relieved to be on the sidelines, watching another £45K magically disappear from the Ferret family portfolio, without being able to take any action at all. At least I can't panic sell. Effing brilliant, I don't think.
Best of luck. RF

Good morning Cliff
There is no "perhaps" about it, imho.
As previously opined- a classic!
ATVB RF