Member Info for Treadstone

You may be right but the repayment plan as presented in their RNS is'nt self explanatory. It looks like nonsense to me. R4e are trying to pay back AIB with shares that are'nt worth £5,155,000 at the current share price and then telling them to wait 5years to receive £2m which they will be lucky to get anyway. The plan being to pull off a Paul Daniels trick of converting shares not worth £5m into £2m in five years time. Over 5years at £400,000 per annum (the current rate of repayment) R4e would have paid AIB £2m anyway. So AIB might as well carry on and wait 12years to get their £5m back. In the meantime the balance of £9m might get paid by other investors and AIB paid off in a lump sum. Well R4e have until october (the completion date) to sort something out. AIB are not in my opinion forced to accept a £3m haircut if they are prepared to wait longer for their money. As for the £9m no investor is going to bite without proper sureties after watching the company's relationship with AIB. Should R4e start to prosper going forward it would be better for AIB to accept better six monthly returns over a longer period than receiving shares of dubious value. The situation is fluid and worth watching.

Right I've given this another look and I find their RNS re debt settlement ambiguous and as clear as mud. R4e is currently carrying a huge debt of £14,585,000 assuming the debt facility with AIB has been fully utilised. This versus a market cap of £1,797,600. How it got itself into this mess you may know. However I do notice its been able to pay £200,000 back to AIB every six months just enough to keep the wolf from the door. I don't quite understand what the number of fully diluted shares at completion are, however if we take the number of shares in issue ie 74.90m and use that, then AIB's 12.50 % works out at 9,362,500 shares for which they will receive £5,155,000. That means the share price AIB receives will be 55p which can't remotely be correct. So the undiluted no of shares just has to be staggering ...?? or what..?? Then there is the matter of the remaining £9,435,000 that R4e has to collect from other sources to pay back AIB by completion date (ultimate date october 2015). Other institutions I assume and not impossible levels of dilution at the current sp. As for the put option why would AIB want to exercise it all. That simply means that after 5 years having received £5.155m in shares R4e will pay you back £2m for the same shares. What sort of a deal is that. I would promptly sell the stock if I could but probably more difficult than one thinks, which is why R4e are giving AIB a royal shafting I suppose. The moral being if you lend £14m quid to an organisation without proper collateral you wind up with a problem. Nothing here you don't understand or have'nt seen so what have you spotted here. It looks like I've missed something or the market cap does'nt reflect the assets of the company. The debt problem looks to be pretty serious and company debt plan poorly explained. Await your reply with interest

Thanks for your reply and will examine your figures after lunch.

I too have been watching this for a while and gettin confused by the details of the re-financing plans. Can you possibly explain please how the £2m put option works and why R4e is offering this to AIB..?

Big loss on continuing operations is a disappointment but the market waiting for result of negotiations.

Nevertheless this just gets murkier and murkier. Why did AGR suddenly get cold feet after the work it put in. Strange. Its definately turned this into a buyers market for any purchaser as TPL board are in a difficult position. NOG have made a $5m loan and don't want to throw it away so probably intend to make an offer, but may exact a lower price than 11.5p a share as Tpl in no position to negotiate a better one in its current position. Insufficient cash to carry on or fund any of its programs. Not comfortable with this at all.

Ready for what...??

It seems that China is a fly in the ointment. Govt attempts to prop up the markets there are not working. 8% fall today. People borrowing money to buy shares (1929 comes to mind) and over capacity in the economy are proving major headaches. Blocks of flats lying empty, factories producing more than they can sell etc. Articles in the newspapers are playing this down but another 8% fall today tells me this could spread worsening contagion if it is'nt contained. You've only got to look at the commodity markets to see what falling chinese demand is doing. Fortunes will be made when the cycle turns but that is a long way from now. As you say asset prices are being supported by ridiculously low interest rates. When that ends things could get a little difficult. USA will raise rates first in my book then those countries with dollar denominated debt will start to experience trouble. In the UK asset bubbles will start to deflate and debt will become a bigger problem for most borrowers. Well I'm the fellow with his cash stuffed in the sofa but getting bored with the wait, yet when Morgan Stanley issued their warning to get out of stocks in march 2007 I stayed in cash and did'nt buy until january 2009. Maybe I need that patience again and don't get tempted by what I think may be good trades. I find it hard to read the tea leaves though. Experience has taught me that markets can suddenly turn on a sixpence catching a lot of us out. So far I've doubled my invested money by trades in MXCP and 2 nervous trades in CPX, but am well aware that lightning does'nt strike a third time in the same place. Anyway any crash will wipe away speculative stocks with no fundementals and leave even good ones a bit bruised. A bull market this is ....not imo. So what to do? Leave it alone for a while or go for quality.

Well done here. Should have bought in but did'nt as usual. Sitting on cash at the moment as a bit nervous of which way the market is headed. Any thoughts?

Set the cat amongst the pigeons and should give Tpl a better support price imo at around this level even if Nog don't follow through. A bit of a cheeky bid but Tpl needs serious funding for its future drilling program and so Nog think their's is a fair offer at this stage. I think AGR's regional connections are far better and Tpl will prefer to stick to the current plan. We'll have to wait for the AGR deal to pass through all the hoops. I just hope the Kazak govt does'nt sit on this too long. we still don't know why they rejected the Sinohan deal. Its all a bit murky for my liking but there you go.

Sorry no link just flipped through a copy of IC in a newsagent. I don't take the online edition either. I used to try some of the IC recommendations but after being burnt in TPL and IQE, which went in reverse to the tips, I treat it with a pinch of salt. Mr market behaves as he sees fit. Share price action is heavily influenced by sentiment and short termism. A lot of good profitable companies on Aim remain under the radar and junk stocks fly on prospects rarely realised. Trak is one that has done well but the future is another matter. Doing well in this market is a matter of stockpicking and that's a tough call.

Although I'm not in this, I noticed in todays Investors Chronicle this is still getting a thumbs up from Simon Thompson even at this level. Would have been a great investment if I had followed his initial advice.

slightly above the bid. There was a young man called Wyatt, whose voice was incredibly quiet, then one day it faded away.............. Need some news to stimulate a bit of activity.

It looks like a lot of our back posts have been wiped off. Hope its only temporary. Must be because they're working on the website.

Thanks for your reply and hope we're near the bottom. Kums may be right and this an opportunity to add more.

I can't believe there is no buying here at all but at the same time can't work out the true spread here. Sells look to be at 3.44p and not 3..35p. Assuming more sells than buys I wonder how much further this will retreat bearing in mind Smith and weavers acquisition plans.

those trades in red at 3.6p plus buys or sells...??

Spread as shown is not reflected in the actual trade prices.. Last buy I can see was at 3.64p not 4p. As you say this may retreat but how far is the question. Company has £27m to invest with placement and plans already in place to spend it by the sound of it. Should it fall severely I have cash to add to my 800k shares here. Perhaps I should have sold on news of the placement but the price did not move much until now as June approaches. Trading I find difficult because I always miss the boat.

HSBC Direct denies having received any info on rights issue. Strange because I would'nt mind participating as well. Buys in red above 4p so ticking up a little.

Britishbulls I often read but its hardly reliable as it chops and changes its view almost daily on many stocks. Its TA is based on candlesticks whilst there are many other factors to consider when buying shares. Daily volatility is to be ignored here when there's a lot of important developments ahead for Mxc. This is a buy and hold for reasons we all know. There's nothing out there to suggest otherwise.