Member Info for slowlyslowly

If this is to be built into a company that can bear the weight of being a billion dollar business, HH has to lay the right foundations - brokers, advisers, directors, funding lines, media relations, and so on. The bigger the ambition, the longer those foundations take to get right. We mustn't be thrown by a lack of instant news - if this is going to take off as we all hope it will, we should expect this phase to take some time.

The company now named MX Oil Ltd is irrelevant. Totally.

There was a company named MX Oil Plc. They wanted to change name to ADM Energy. Someone could register a company with that name, blocking this, so once the new name was known a shell company was registered at Companies House named ADM Energy Ltd.

On the date of the GM to approve the name change, MX Oil Plc had its name changed to ADM Energy Plc, and ADM Energy Ltd had its name changed to MX Oil Ltd.

So the company now named MX Oil Ltd does not own any part of Superdialetics - in fact it doesn't do anything. It was only registered to bag the name, and I'm sure will soon either be dissolved or have its name changed to something else entirely so it can be used for a similar purpose with another company wishing to change its name.

To anyone reading this over the weekend:

It may be on Monday we get an RNS reporting a director selling shares.

Often, when you read those, your instinct is to treat it as a negative indicator. For good reason: directors know what's going on, and if they sell it may be because prospects aren't good.

In this case, something different is going on. There's new management in charge here, and with that should come all kinds of now-fundable developments. Assuming the director selling is Stefan, the director sale actually points to the changing of the guard continuing to progress. That would make it a positive indicator.

If the RNS comes, don't misread it.

If it was him on Wednesday, Thursday and Friday then Monday is the deadline (if the 3 days counting includes the reporting day but not the trading day)

As of the end of June, he held 630,000.
On 1st July he sold 50,000, taking him to 580,000.
If the 25k we've seen over each of the past few days were also him, he'd be down to 505,000, leaving him 80% of his original 630,000.

He's still got half a million to shift. This could go on for a while.
But, once it's finished, ...

Hmm

That 15% was a one-off sale at 19p. Curiously, it didn't move the bid and ask, remained 20 and 22 after that sale went through.

But more curiously, the sale was for exactly 25,000 shares. Deja-vu anyone?

Interesting, thanks. I notice that they're on the main market not AIM. The more significant thing is that the company was formed and floated in order to be a cash shell, rather than becoming one by ceasing all trading activity.

If you look back at the RNS history of MXO, they didn't release news after every uplift - the March one was unusual in that regard. So I personally think the June uplift has happened and been priced, and we'll hear about it in the 2019 accounts, or (more likely) when there's other news to release such as a new board member or at the AGM.

May be.
His last RNS had him selling 50k in 2 x 25k lots.
Prepare for a "Director Dealing" RNS, followed by another dip as people read (without thinking) that it must be bad news if a director is selling shares in his own company.

Sure, I realise that. I was wondering, more specifically, why the bid and ask dropped steadily yesterday in spite of predominantly buys going through, and why they've risen steadily today in spite of predominant selling.

Odd movements tbh - a bit like yesterday in reverse.

I think all the trades at 22p and even 22.25p are sells not buys - I was getting 23.6 quoted to buy at that time, and 22 to sell, so those seem to be the actual (as opposed to quoted) bid prices at the time.

But if the ask is 24, and if all those trades (yes, including the 6 shares one) are sells, then why have the bid / offer prices drifted upwards throughout the day?

The £69,770 is not the amount they're looking to raise.
They want authority to allow / convert into "shares in the Company up to an aggregate nominal amount of £69,770"
The key word there is "nominal". The nominal value of ADME shares is 1p. So they are asking for authority to create up to 6,977,000 shares.
If they created that full amount, and if they placed them at 1p, then - yes - they'd raise £69,770.
Or they could place them at 10p and raise £697,700 instead.
Or they could place only some of them , ... - the combinations are endless.

I don't think you are missing anything.

Where did you get the £70k figure from?

Just because they've made the standard-ish move of asking authorisation to issue up to 15% of current shares, doesn't mean that they'll use that authorisation at all, or that they'll use the full wack if they do.

It's why a 13% drop really is the worst case scenario. There are so many ways this could play out better than issuing all 15% for free - like a smaller issue at a premium!

Only you can make that decision. But as I argued earlier, now we know how many shares the directors are asking authority for, the dip caused by any placing should be no more than 13%. That means that other news incoming (board, June Aje uplift, new business ventures being explored etc.) are likely to be a bigger share price mover than any placing we may get. (All of that is, of course, assuming the market behaves logically!)

@FinnFCR: Why?

100:1 now would take us to 2.4p, and 250:1 would take us to 6p. So I think you were out by a factor of 10 in saying 1p or 2.5p?

And my other point was that, even if they practically give shares away, they can only issue 15% of the current shares.

Which means, if the price was 23p before they announced such a give-away placing, the dilution means that the correct adjusted price after the placing is just 20p.

So now we know how many shares they're asking to be allowed to issue, all our minds can be put at rest: There will be no placing that will significantly dent the current sp.

That's my point. If they placed at 4p this time, they'd only raise a little over £250k. So by setting the maximum shares they have in Resolution 4, they pretty much rule out something so cheap.

I hope everyone has read the formal notice of the AGM: http://www.admenergyplc.com/pdfs/ADM-Energy-Notice-of-AGM.pdf

There are two or three folk on here arguing either that this company will sink using the following argument: 1. The company's cash position and short term financing is, and always has been ropy. 2. A sheikh chairing the board won't miraculously fix this - why would he dip into his own pocket to solve the problem. 3. Therefore a placing is coming. 4. The previous placing was at 4p, and the next one may not be quite that low, but it will certainly be well below the current share price and at a significant dilution to holders.

OK: Now read the Notice of AGM. They're asking for authorisation to issue shares up to a nominal value of £69,770. That's 6,977,000 shares. Which is exactly 15% of the shares currently in issue.

15%.

So even if they _gave_ those shares away to their mates for nothing, your share of the company's wealth would only drop by 13%. That's the absolute worst case scenario.

But they're not going to give them away. They're going to give them away in exchange for money (i.e., funding to run the company). So the total book value of the company will go up as these extra shares come out, meaning the dilution will be substantially less than 13%. How much less? We don't know. But the more funding you want to argue that the company needs, the higher the share price they'll need to issue them at. If they issued them at 10p, they'd raise only £700k, and so on. So the bigger the number someone comes up with for how much the company needs (thinking they're arguing against the prospects of investing here), the more they're actually proving that a share placing won't be diluting.

There are two other factors to remember. There may be no placing. For two reasons. 1. To ask for authority to issue 15% of shares in issue is pretty routine, and doesn't actually mean they'll use it. 2. Resolution 5(a) chooses to leave open the possibility of them doing it by an offer to existing holders rather than by a cheap gift to the broker's mates.

That Notice of AGM makes me quietly more confident here.