Member Info for RyeSloan

Mellon can be both I suppose....a real advocate for change that could bring huge benefits to the world while also making a few quid. But he has plenty of previous fro looking after number one so a philanthropic saint he ain't.

The fee being paid on a NAV that benefitted largely from a technical uplift from premium fundraising was a bit rich to say the least and I would have hoped the rest of the directors would have been smart enough to have put a limit to that in any agreements but that said it's also worth mentioning that the 15% fee was to Shellby not Mellon directly. Shellbay complete all the heavy lifting here from a fund management perspective so clearly will incur costs completing the due diligence etc. Yes I'm sure there was plenty of fat left for Shellby owner Mellon but let's not misconstrue the payment as a direct salary as it is certainly not that.
Also the fee was paid in shares so did not cream off any funds from future investments (albeit it does of course dilute other shareholders future returns).
Finally it's a bit glib to suggest the money could almost as easily have been raised without Mellon...considering the leading position ANIC has established in this area off the back of the efforts from Mellon / Shellbay over the years it's maybe actually easier to imagine the opposite that it would have been substantially harder for someone with less standing and pedigree in this sphere to raise such sums at such a premium.

Having looked at this again BRWM appears to have an explicit policy of paying out almost all excess income. The final last year was pretty much bang on the difference between the two reported NAV’s.

So this year’s final would be about the 27p
mark. We’ll find out soon enough I suppose.

As for the current year well the miners seem more than happy to keep throwing off large divs with BHP the latest with a 50% increase to their interim. So the flow of income here doesn’t seem to be slowing down.

Tune...the abrdn div's are pretty straight forward 7.3p interim and final (14.6 p.a.) until covered 1.5 times by adjusted capital generation. These are paid end May and Sept each year. In terms of when this div might actually grow the capital generation ratio was 1.14x at the half year v 1.02x at the prior full year so there is a bit to go yet in terms of profitability.

That said II should add to the bottom line, the integration costs should finally be tailing off (£542m and counting so far with £27m cost in H1 2021!) and the trading update today suggests the AUA bleeding may have finally been stabalised so the full year for 2021 will hopefully show some further progress on this front (albeit probably slow) with more to come in 2022.

The good news is traditional French cheese producers are not the initial market for Formo! And that's the beauty of this tech, the addressable market is so huge that we can total ignore high end or traditional cheese producers and still have a huge space to move into. I believe over time that precision fermentation will pretty much replace all dairy herds but I totally get that quality operators and traditional producers of products of dairy produce will be around for quite a while yet. Provenance and (perceived?) quality will count there. For the much bigger mass market though precision will be eagerly welcomed for a number of reasons...and if that helps to reduce the cruelty to animals like seen in the youtube link then the sooner the better in my book.

A bit of a lull in news and SP just now...clam before the storm I'd say and a perfect opportunity to load up on a few more shares here for those still looking to build a position. I think we are soon going to see a big move forward across a lot of the industry as the substantial sums invested in the last year or two start to bare fruit. Liked the £1 predicto in two years time, that would do very nicely indeed thanks ;-)

Excess capital sitting in the accounts. A lot of which has came from sales of the Indian JV.

I agree it will probably be a return of capital…these are a bit of a pain for small investors (of which abrdn have a lot) though as a lot of them will like to reinvest dividends and can do so cheaply via their platforms.

A return of capital will result in a small windfall and a corresponding share consolidation leaving the small investor with a smaller valued holding and some cash. The immediate net effect is the same but I think most would prefer the rather simpler special div which would allow the aforementioned reinvestment thus maintaining the value of their holding.

No right or wrong on the Open Offer. I took it up plus a bit more to 1) Support the fund raise by giving capital to the company rather than spending it on the secondary market 2) I don’t need to spend my capital now on the warrants so liked the free option they give on the upside and I can exercise (at a fat profit I hope!) without risking a single pound of my cash.

Totally get why others would counter the dilution by adding at 20.5p though..horses for courses n all that.

Either way the fund raise has gone well from a total ££ perspective and sets us up very nicely indeed for a rather interesting 2022!

Warrants being exercised will mean the SP is above 29p…they also give substantial funds to the company to invest, which in turn should increase the return. Also if the SP is at a premium then they will increase the NAV.

Some might be exercised then sold but again if they are then the SP will need to be north of 29p to make that worthwhile!

I don’t see them as a headwind but hopefully a source of significant new funds and supportive of the growth of the companies NAV.

I agree in principle that the fee structure is reasonable as an effective performance fee. What is NOT reasonable though is that the vast majority of the 6.85p rise in NAV being used to calculate the Shellbay fee has come from the technical effect of the May fundraise being done at a substantial premium. I can't remember my working exactly but I'm pretty sure it was worth about 5.5p to the NAV at the time. I'm very minded to think Richard as CEO of Agronomics should have ensured that the effect of fund raises on the NAV should have been removed completely from any fee calc, or at the very least substantially discounted.

The good news is that this effect should be a one off as the total assets start to represent a larger starting value relative to any future fund raises. Still the point stands and we have effectively paid almost £8m in fees on top of the £3m suffered at the time for a £60m fund raise event...steep in anyones book I'd say!

We might see some cash applied to this fund raising round? OK we are a touch late to this party but it does seem like these guys are making great strides and have some very big backers…

Been watching this one for a while...company updates look very good yet the SP the opposite.

TOSCA I assume are selling at any price hence the SP has a hole below the waterline. Often these situations are an opportunity rather than a concern (well for new investors anyway!).

Tempted to add here on this potentially temporary weakness but would like to hear current holders thoughts! With the refinancing done (and excluding the one off cost) we should see another £10m drop to the bottom line for a EPS of about 5p, is that assumption about right so we are looking at a forward valuation of 3x earnings?!? For a company that looks to have sorted it's shxt out and appears confident in it's growth path from here this looks a rather fine bargain.

Always hard to catch the falling knife though....

The forecast div is a bit of a stretch considering Grindrod made losses for the last few years but I trust the management know what they are doing here!

The fact that a chunk was paid for by flipping a couple of ships for a quick 50% profit underlines that position I suppose.

More likely they got their shares via the placing rather than the open market (they might have been in from May as well but under the 5%) but who knows really!

Interesting to see Blackrock have taken an over 5% position here…that’s the first II that have notified a large holding that I’m aware of. Very positive I’d say.

So technically it is true but AJBELL have had mine sitting in my ISA since last May…not sure what’s going on there to be honest but they are there no doubt about that.

This is not about alternative meat. They have just completed 2 large fund raises for the best part of £100m in the last 6 months at 22p - 23p and you will 'jump back in at 5-10p'...lol good luck with that tactic.

You get two years to commit exercising the warrants so you have the benefit of hindsight if you do…so buying now is not the same risk at all. The warrants are basically a free hit and I’ll look forward to exercising mine in 2 years for a fat profit ;-)

It’s not been offered yet. You’ll get the offer via your broker / platform.

This raise will bump the NAV by about 9.5% I reckon.

That’ll give it a 21.5% increase since the June NAV I reckon.

I’m struggling a bit to understand the wording around the fee calc. Is it simply take the final shares in issue for the period and multiply that by the start of period NAV per share to get a nominal start of period Net Assets and then subtract that off the period end Net Assets to get the value increase (of which 15% goes to Shellbay)?

No.

Any shares in the open offer will cost you 23p…they come with a ‘free’ warrant which is the right to buy 1 share at 30p at set periods throughout the next 2 years.

If you exercise that right you will get one share per warrant but it will cost you 30p.

Effectively the warrants give you a free option but no commitment to buy another share at 30p.

If and when you do that you will have bought one share at 23p and one at 30p giving you 2 shares at a cost of 53p and an average of 26.5p.