Member Info for Stevo12

As I have been saying for the last few weeks that there will be high volatility for first couple 0f months as distressed debt funds Unload the 3 billion shares they have been given to support the Harbour bid.

I have been predicting a trading range of 20-30p with creditors selling their shares into every rise towards 30pmWhich will bring price down again. It is going to take 2-3 months to clear out the 3 billion creditor shares before we see prices normalising.

There is also a 10p spread with offer at 30p. Would not pay much attention to IG yet. Let the count down begin

Rookie

The creditors have been dumping shares via shorts for the last few weeks. The]is has resulted in shorts increasing to 176 million.

The problem is that there were only 1 billion pmo shares in issue and there are 3 billion creditor shares. Accordingly it was only possible to pre-sell a certain number of shares as you have to borrow them first. Most PI shares cannot be lent so there just was not enough capacity to short more.

This is going to be really interesting and I have set my top up buy at 20p.

SmallT

Wouldn’t it be wonderful if quoted companies were valued at their intrinsic value. Over a long enough period the truth outs, but the market can remain irrational for far longer than investors can stay solvent. The share price this week has been driven by the market markers trying to balance buyers and sellers. If there are more sellers than buyers, the the price is lowered until more buyers come in or sellers change their mind and vice-versa.

Over the last couple of weeks we have seen a high volume of creditor shares being pre-sold via shorts. We will likely see high volume of creditor shares being sold for the next several weeks. This is going to distort the share price and hold the price down until creditor share overhang is cleared. Once the shareholder base stabilises, dividends declared, FTSE entry confirmed and first set of half year results published, the share price will be comparable with peers. In the meantime expect high volatility.

It all depends on how many of the 3 billion creditor shares are dumped on the market. I am afraid t here is likely to be a major disconnect between value and share price for next couple of months.

I have no idea what the share price will be tomorrow - it is a matter of supply and demand for shares. I believe the shares will trade both lower and higher than current price over next few months and will be up and down like a fiddler’s elbow. Unfortunately we are totally in the hands of distressed debt funds until they have offloaded their 3 billion shares.

Luf

You are correct. There will be an initial free float of 23% or 4 billion shares. Chrysaor shareholders are locked in for 6 months except for Harbour who are locked in for 12 months.

Debt holders with more than 2.7% of shares, there is a 3 month lock in but unlikely than any one creditors will have 500m shares after closing their shorts.

Kraken. Great call on +10% today and I hope people did not buy on the back of your lack of understanding of what is driving the share price. If you thought the volatility today was disturbing based on 14m share changing hands, wait until tomorrow and the next few weeks as distressed debt holders offload some or all of their 3 billion shares.

As I have stated in previous posts, I believe that the share price will likely fluctuate between 20 and 30p over next few weeks as creditors sell their shares into every rise. Hopefully there will be a lot of off market purchases otherwise this could get really messy.

Need to embrace and trade this volatility and take some money off the big boys. I have deposited cash at IG Index and long order placed to buy at 20p with a limit of 28p. Once price hits 30p, I will go short with a stop of 22p.

Kraken

Who do you think is going to be buying these massive amount of shares this afternoon?

Kraken

The distressed debt funds are set up for a very clear purpose - surprisingly to buy distressed debt, force restructurings and make significant returns for their investors. They are not interested in whether the company may pay a 5% dividend in 2022, they will need to redeploy the roughly £1 billion they will have tied up in Harbour. They are not equity investors and the sooner they sell their shares to long term equity investors the sooner we will see Harbour realise fair value.

The sooner we are rid of ARCM and the other distressed funds the better we will be at LTH’s. However the truth will out and we will see what happens over next couple of months. Fancy a small wager?

Rock

Yes but 14b shares subject to lock ins and not tradable for at least next 6 months.

Ups

Depends what your time horizon is. Today’s price will look like a great entry point in 6 months time. However I think their will be lower entry points over next couple of weeks. You need to do your own research

Kraken

Shorts will likely all close over next couple of weeks as they are not real shorts. The increasing over last 2 weeks to 17.5% of PMO total shares in issue has been very material to PMO volumes and share price leading up to merger, but I agree irrelevant to Harbour post merger.

The big issue is the 3 billion creditor shares. You seem to believe the distressed debt funds will convert to long term equity holders. You might as well try putting a crocodile on a vegan diet. These guys will brutally exploit every rise in the share price over the next couple of months until they are fully exited. My call is that we will see swings in share price of 25-30% (not in one day) until stabilised in June/July.

Need to understand that of the free float on 1 April of 4 billion shares, over 3 billion are held by distressed debt funds who will want out.

I am not saying the share price will fall to 20-22p today but over the next 2-3 weeks as creditor shares are unloaded into the market.

Kraken.

Absolutely. I have been pointing out for last few weeks that distressed debt holders are pre selling their shares via increased shorting which is depressing share price. The number of shorts continues to rise because they are not real shorts as I have pointed out to you many, many times. The only thing I have got wrong is that I understood that the shares would be suspended for 2 days. this was based on confirmation from PMO investor relations 2 weeks ago.

If you are unable to see the volatility that is coming and the opportunity that it presents, then fair enough.

FI - I think you could have waited a little and gone long at 20-22p. I believe you will have the opportunity to rinse and repeat over next couple of months. I have set a trading range of long at 20p and close at 28p and short at 30p and close at 22p. Let’s see how this plays out over April and May. I will likely adjust ranges once trading patterns emerge post 1 April.

This is a great opportunity fir PI to take back some money from the big boys. They don’t present themselves very often.

Distressed investors will not want to hold shares and they will be keen to redeploy their funds to the next victim - they will not leave money tied up in harbour equity. They have been given a sweetheart deal and even at 20p, they are making a huge profit on their original investment. I invested in PMO bonds in June last year and it has been the best performing asset in my portfolio.

Many of the distressed debt investors have already sold out by taking out shorts (including me), but this only accounts for 170m of the 3 billion shares they will be given tomorrow. Shares price for next few months will be driven by how quickly the distressed debt investors sell their shares and what floor price they are willing to accept.- I am betting 20p to get out quickly, but this is just my personal view.

I also invested in Premier shares and will buy more on the dips around 20p post 1 April. This is going to be a great share in the medium term but everyone needs to fasten their seatbelts for high turbulence.

Lots to like about Harbour and definitely undervalued to peers which will correct over time. However we need to accept that the share price over next couple of months will not be driven by value but by the number of. creditors shares being sold. LTH need to sit tight and top up on dips around 20p. My prediction is a trading range between 20p and 30p over next 2-3 months with price stabilising and moving up to 40p in July/August. More selling then likely in October as some of the original Harbour shareholder lock ins expire.

Yes old pmo shareholders have 1 new harbour share for each PMO share.

If the share price was going to be 30p tomorrow, it would likely be 30p today, unless there is a big spIke in oil prices overnight. The share price has been held back over the last few weeks by creditors pre selling there shares via shorts which have increased by 60 million. I Believe this downward price pressure will continue tomorrow and for the next several weeks as the distressed debt investors sell their 3 billion allocated shares to equity funds. This will ultimately create a free float of 4 billion shares by early summer and the share price will then hopefully achieve fair value with dividends declared, results published and FTSE entry confirmed. Fair value will ultimately be linked to the Oil futures curve and whether recent gains in oil price has been retained.

Also teach me not to listen to PMO investor relations team. Although to be fair to them, it does like their plans changed last week.

Just want to acknowledge that I got it wrong re timing of suspension of Premier shares prior to readmission on 1 April and Kraken was correct.

Important to understand, acknowledge and learn from your mistakes.