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Positive news on the vaccine front should lift the sp very nicely this week. Barring a calamity, IAG should see a very good summer next year and a gradual recovery thereafter. Given they have 12-18 months of cash to burn, it is looking like they will pull through comfortably. The biggest hedge fund in the world seems to think so, having just taken a 3% stake.

Why the recent falls? Have the expected PE bids died a death? Still, in the long-term I’d rather remain holding than be forced to sell. I think Clipper will be a pretty reliable 5% yielder.

From FT 14 Oct:

Hedge fund Marshall Wace has taken a large stake in British Airways owner IAG, one of the first big investment groups to bet on a sector battered by the coronavirus pandemic.

The London-based group, one of the world’s largest hedge funds with about $48bn in assets, disclosed a 3 per cent holding on Wednesday. Marshall Wace and IAG declined to comment on the trade.

The bet is a sign the group believes there is value in UK stocks, said a person familiar with its thinking.

Encouraging news:

US officials are said to be aiming to open travel between NYC and London by the holidays and reduce traveler quarantine periods

Among the plans would be to test travelers before their flight and at arrival

Increase in fast COVID-19 tests has encouraged authorities to revisit plans to create safe travel corridors between the US and international destinations

https://www.dailymail.co.uk/news/article-8827537/US-plans-open-travel-corridor-NYC-London-time-holidays-report-says.html

Good point on the LUFC sponsorship. It seems like a bit of a vanity project. As far as I can see, Clipper has no direct consumer-facing role, so the sponsorship seems rather pointless.

It will only take another bit of positive vaccine news to send the sp soaring. That will probably drop in the next few weeks. Meantime, some clarity on airport screening will help. £2 is probably a year away imho.

The oil price is up and most stock market indices are up. What is it going to take to bring President Energy out of its current slumber? I’m starting to think that even if this company struck gold, the SP still wouldn’t budge.

Badger

I think that would just be tough titty (I could be wrong but I’m pretty sure no precise date would have been guaranteed in the small print). Anyway, the chances of it dropping below 88p seem rather remote. The SP has seen some huge daily falls, but there is no reason why that can’t work the other way too.

Cowboy

Halve the number of shares you held before the ri. Times that by 3 and that’s your new number of shares ( assuming the funds were in place to cover their purchase).

Presumably the IIs have received their RI shares and are free to trade them, so one might imagine that, once PIs get theirs, the impact on the sp will be minimal.

£5.50 would have been a good offer last year, but that was last year. The dynamics and growth potential of this company have changed markedly since then. I reckon £6.50 or no deal. Whatever Parkin wants, he still needs the bulk of IIs behind him to get a private equity sale through. What incentive do IIs have, to sell up, lose a nice little divi earner and forfeit almost certain future growth here?

Given that we are a few months behind China, this could be the UK by the spring (possibly even sooner with a vaccine).

From the Times 3 Oct 20:

The Wuhan Sports Centre, which served as an emergency quarantine hospital at the height of the pandemic, reopened this week with a 10km run by 2,000 people dressed in patriotic red.

The Chinese city that was the epicentre of the outbreak is booming again, with airlines adding flights to accommodate a surge of travellers for the first extended public holiday since January 23, when it was shut down as the outbreak raged among its 11 million people.

Six months after the city lifted its shutdown, Wuhan is throbbing with life again. Streets are decked in Chinese flags to mark National Day and to show pride at having prevailed over the virus.

The sports centre was fully booked on the first day of reopening, shopping streets were bustling with crowds and its landmark Yellow Crane Tower put on a dazzling light show at night.

The situation is a long way from the lockdown when Wuhan was just deserted streets and empty train stations. Hospitals were overrun with feverish patients, funeral homes operated round the clock, and tears of desperation were shed in every part of the city.

There were 15 million train travellers on Thursday, and the rail authorities expected a further 11 million yesterday.

In Wuhan, the once-deserted train station in Hankou dispatched 123,000 passengers on Wednesday, the highest number for a post lockdown day.

As part of their monitoring, hygiene officials on October 1 collected 3,600 samples from places such as medical facilities, supermarkets, wet markets, public buses and public toilets. All samples tested negative for the virus. Random tests of 124 employees with high-risk jobs were also negative.

From The Times 3 Oct 20.

A mass roll-out of a coronavirus vaccine could be completed in as little as three months, raising the prospect of every adult in the country receiving a jab as early as Easter, The Times has learnt.

Scientists working on the Oxford vaccine hope it could be approved by regulators before the start of next year, with some health officials estimating that every adult could receive a dose within six months.

Government sources involved in making and distributing the vaccines told The Times that they expected a full programme, which would exclude children, could take six months or less after approval, and would probably be significantly quicker.

The authors of a Royal Society report claimed that it could take as long as a year before everyone who was eligible received the vaccine. But health officials believe it can be done far faster irrespective of which vaccine is successful.

Within weeks training will begin for an army of physiotherapists, midwives and other health professionals drafted in to administer the vaccine. Rules are being drawn up to allow a much wider group of healthcare staff to give the jabs. Drive-through vaccination centres are being planned to cope with the huge logistical challenge of administering vaccines to tens of millions of people. The armed forces are also likely to be called in to help.

I have already booked for next year (NYC with BA, rather than Camber Sands with Wallace Arnold). Vaccines will be the game changer here. There will be no quick miracle cure, but things will improve exponentially once vaccinations are rolled out among the general population.

There is huge pent-up demand for air travel. Just about everyone I know can’t wait to book a foreign holiday. It will only take some positive and substantive news on vaccine trial results to send the sp soaring and customers flocking to book their summer holidays.

From the Times 1 Oct 20:

Clipper Logistics shares hit their highest price in more than two years amid further chatter that private equity houses are eyeing up a bid for the delivery group.

There have been a few murmurs involving Clipper in the City in recent weeks and the speculation ratcheted up a level yesterday as Bloomberg reported that several buyout funds had cast their eye over the company.

Cinven, which owns Kurt Geiger, the shoe brand, and CVC Capital Partners, the owner of Breitling watches, are said to be among those interested, although it is understood that Clipper is yet to be approached.

It is not the first time that potential suitors have run the rule over the Leeds-based company, which delivers parcels on behalf of John Lewis, Asos and others. Last year, Steve Parkin, the executive chairman who set up Clipper Logistics in 1992 with a single van, teamed up with Sun Capital, a US private equity firm, to explore a possible bid to take it private although that interest ended up going nowhere.

Mr Parkin and co were said to be weighing up a £300 million deal although any bidder would have to stump up significantly more now. The stock closed up 1.6 per cent at 487½p yesterday, valuing the business at almost £500 million. It has rallied 79 per cent this year thanks to the boom in online shopping during lockdown while it also won a government contract to distribute PPE.

I wonder if Steve Parkin has been soliciting this latest round of private equity interest (as he did with Sun Capital last year) or whether the PE firms are making all the running this time. In any case, if it is not to be turned down by Clipper’s IIs (as appeared to happen last time) any PE offer will have to be substantially higher than the reported £300M last year. Hopefully we will see a bidding war this time - and an offer that is hard to refuse.

Thanks Delhi. If they offer something that reflects the company’s growth potential, I might be interested. At the moment, any offer below £6.50 would not get my interest (nor that of the major holders I suspect).

Nice to see another rise today. Not sure what caused the spike to 527p today. Is there some big positive news in the pipeline for Clipper?

In fact, I didn't wait. Just booked for early next year.
BA LHR - JFK 7 nights at the Intercontinental Barclay (Midtown 5*) for £778 pp. Lovely hotel. Stayed there previously (before and after renovation).