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Bill Are Irv bluffing re the pre pack admin? Or not? I think the presentation of the deal available (that is to say the deal that IRV have agreed with lenders) will give a clue. More important in my view, is the sequencing. If a vote on a deal (without Coltranes option) is put forth then I think that really does spell out what IRV are saying.
Feilb-plan will be announced tommorow with the meeting taking place on the 26th.
See my previous link
Not sure if it will be tomorrow (others may know?), but this week the BoD will outline the proposed deal or deals.....that existing shareholders will vote on.
5% to existing shareholders (lenders already on board)
10% to existing shareholders (Coltranes' deal)
or a hybrid deal ? 7.5% to existing shareholders
If either the 7.5% or 10% deal is put forward and gets approved by existing shareholders then the share price will rise significantly
I'm not sure the 5% deal (that has today been priced in to the current share price) would get voted through anymore as the value here indicates that would be too good a deal for the Lenders and too poor a deal for existing shareholders
GLA
Not sure if it will be tomorrow (others may know?), but this week the BoD will outline the proposed deal or deals.....that existing shareholders will vote on.
5% to existing shareholders (lenders already on board)
10% to existing lenders (Coltranes' deal)
or a hybrid deal ? 7.5% to existing shareholders
If either the 7.5% or 10% deal is put forward and gets approved by existing shareholders then the share price will rise significantly
I'm not sure the 5% deal (that has today been priced in to the current share price) would get voted through anymore as the value here indicates that would be too good a deal for the Lenders and too poor a deal for existing shareholders
GLA
This is sneaky of IRV?? They have postponed the EGM requested by Coltrane until 26th March. So it seems this will happen at the same time or after the vote (if it takes place mid March) on refinancing, so give Coltrane no leverage to out the board.
Surely this should have taken place on 6th March the latest?
Thanks Bill, Have Coltrane now laid all the cards on the table, what is the meeting at the end of March for ?
Tartan- the refinancing arrangements
What news is due tomorrow ?
Thank you to all on here who have provided some great in depth analysis. It's been a great source of information for me. Bought in at 12.87 and holding on. May double money soon but need to keep close to tomo news.
The BoD must back Interserve, Coltrane, their people and existing Shareholders.
If they do, the Lenders (even despite themselves and their greed) will get every penny back. This is really a "no brainer"
Message to the Board - You have a strong underlying business, with good people - back it and back them!
Well done to existing shareholders who held on through darker days and didn't panic.
Lets hope to BoD do their bit now and back the right deal - Coltranes!
news tomorrow
Imagine if the BoD had managed to push through their original deal (6bn shares @ 8p now)!
They would have been lynched!
This SP rise is what would have happened after that deal and the lenders would have doubled / trebled their money in hours, let alone days ....
This share is desperate to fly, on good news. Just look at where their main competitors shares start at £1.20 plus - post DfE they will have less debt / EBITDA than any of them.
Unfortunately,one of the things that has saved the SP (the 20p RI) may put in a glass ceiling for a period of time until the terms of final DfE deal is announced - then it could start shifting very quickly...
BoD - Do the Right Thing!
GLA
Thngs definately looking more positive for all. Hoping the gamble of sitting tight does pay off having bought at 26.5p. Still a lot of game time to go I suspect before it all fully re establishes.
Pearls- I wouldn’t say this is a win win just yet (though looking better),still a huge amount of risk here if no deal can be agreed between lenders and Coltrane. Even though we have a deal on the table if enough shareholders reject it, then this will go down the admin route if Coltranes plan is not accepted.
https://www.google.co.uk/amp/s/www.consultancy.uk/news/amp/20475/ey-reportedly-in-line-to-administrate-ailing-interserve
Decent rise so far today, where will it settle?
Starting point lenders revised (5% ex, shareholder deal) puts the share price at 17p
The 20p RI could limit the SP increase to 20p short term?
Coltrane's (10% ex, shareholder deal) puts the share price at 38.5p
A negotiated middle of the road (7.5% deal) puts the share price at circa 27.75p
Appears there could be plenty of upside yet,,,,,,,
Thanks for the analysis everyone - it is most appreciated by those of us less mathematical on here. Frankly, looks like a win win position is emerging for everyone compared to the previous alternative.
Just hope something like this can emerge with Debenhams!
Very interesting and really significant that Coltrane have confirmed that they will underwrite the £75m Rights Issue proposal.
This puts the Lenders really on the back foot.
The lenders main negotiation was playing "hard ball" and posturing with EY scaremongering about a Pre-pack Admin and stating they would demand £66m immediately if their deal was not agreed,
But in reality, Coltrane have called their bluff - they would just purchase £75m shares at 20p (or less) and the £66m would get paid off. Leaving Coltrane with time and an even stronger position to call the shots.
The Lenders will be forced into a reasonable deal now - fair play to Coltrane for putting their money up!
Coltrane were correct the 2.5% (ex. shareholder deal) was really "obscene",
Better days ahead for Interserve.
If the lenders end up holding 81% of the shares, they will to a certain extent be able to control the price of the SP even if there was a poor trading update in the future. Over time they would recover all their investment and a profit.
The only problem being is that banks don't like holding shares in private companies, as it can affect trading with other Businesses (possible competitors)in the same sectors.
Hopefully they have some common sense. As they will now be equity holders as opposed to debt holders, fluctuation is part of the package just like what’s happened to us. Just because they will want the value of their stake to equal exactly the amonut of debt they will reduce now, this does mean the sp will not go below this price. It will just take one bad trading update.
The lenders could take up 65% of the RI as you state = £48.75m which equals 243.75M share.
The lenders average is then :
243.75M @ 20p
and
975M @ 44.7p
Lenders Average = 39.8p versus 38.5p (post DfE SP), so yes the Lenders would initially be down by 1.3p × 1219M =£15.8
The post DfE valuation is just the value applied to the shares at the point of DfE - £436m (lenders shares) + £67M (ex. Shareholders) + £75M ( RI).
Agree it would be the Lenders who would be cutting off their nose .......if they reject this deal!
So they would still be loosing 1p a share after the rights issue. Also how are you getting a d4e value If 578m?
I did initially consider they would take part in the rights issue, but that would still leave them with an average @39.8p.
Based on the their holdings they would be entitled to to purchase 243750000 share @20p which gives a total of £48.75m. Add this to the original 436m gives you a total 484.7m which is more or less the original figure in the proposed d4e swap. However the lenders now own 81.3% of IRV for their £480m as opposed to the proposed 97.5, but they still are in control of the company as the hold the majority of shares.
Personally I think this is a sensible outcome for everyone involved including the lenders, but just depends if they are willing to give an extra 14% of the company away, as well as take the a “hit” on the share price. I don’t think it’s worth a pre pack deal for the sake of 14%, since they will have to pay administrators cost, possible risks of JVs being bought out at a silly value as well as having to pay clients.