Avacta Share Discussion Threads

[pwhite73] 23/4/2024 11:53

Aman - "Peeps laughed my 43p prediction"

When a placing is announced at 50p, 43p two days later is hardly a prediction is it?

Now had you predicted 43p when this was 180p in February last year that would be something to pat yourself on the back about.

And by the way who was laughing?

[amanitaangelicus] 23/4/2024 11:00

Peeps laughed my 43p prediction ...obvious support level ...unlikely to hold though unless stellar news inbound. Hey ho. GL sufferers. Simon andcGarfunkel ...Slip sliding away ...singalong.

[fieldhouse] 23/4/2024 08:58

Results on the 30th April.

Will all be revealed ?

I would very much hope that within two years the trials will have given results that either make or break the company. (make i must add)

Seven more dilutions (next 24 months) or sale of the DX !!! What will it be ?

[filthypoor] 23/4/2024 08:42

So, another 3.5 years to pay off the debt, if they last that long..!

[amanitaangelicus] 23/4/2024 08:16

Remember though, if this works in Phase 2 as well as Smith says so, it s a game changer and the company will be valued way, way higher than today - fact. While to go til we get there tho. Cat n mouse over the next 1-2 years. Dilution v potential game changer. It s still a moral, noble cause- we need this tech to work for all of our sakes. Need more data. Simples. GLA genuine posters.

[fieldhouse] 22/4/2024 20:24

jakNife/Aman,

Thanks for the insight to the convi boys workings.Very plain to see now !!
Bloody well stinks

[amanitaangelicus] 22/4/2024 18:59

Susq ,as a mkt maker ,can go short to make a mkt in Avacta shares, as any mkt maker can. Despite being a separate legal entity to the convi boyz, personally, I consider them linked at the very least. It.s plain wrong. They shouldnt be allowed to do this. Susq are on the opp side of our trades( to make a mkt) ,more importantly they dont know what you or i might do. Sadly, in the convi boyz case they.ll know exactly what the game is and it stinks. Too closely linked. These guys are bright and know how to make wonga. Despite being separate legal entities, it doesnt stop the scheming. Death spirals are killers. Love the companies comments on repaying in cash but in this case decided not to ... in dreamland. Convis are dire, like a casino skim at every turn. Whitey , please stop arguing with Jakn- he s on it, you re not. You were taken in by Tickboo.s feeble arguments. Look where that got everyone. As i ve said for eons , cases if convis being good news are as rare as Steptoes teeth

[jaknife] 22/4/2024 17:28

PWhite73,

"Death spiral financing is the result of a badly structured convertible financing used to fund primarily small cap companies in the marketplace, causing the company's stock to fall dramatically, which can lead to the company's ultimate downfall."

My problem with that definition is that it is set in the past tense. You would only ever know if a particular convertible is a "death spiral" with hindsight.

I would prefer a definition similar to:

"...convertible at a discount to the share price at issuance and for a fixed dollar amount rather than a specific number of shares. The further the stock falls, the more shares you get."

From:

JakNife

[pwhite73] 22/4/2024 17:21

"Death spiral financing is the result of a badly structured convertible financing used to fund primarily small cap companies in the marketplace, causing the company's stock to fall dramatically, which can lead to the company's ultimate downfall."

Capitalised at £250 million in October 2022 when the loan was taken out AVCT were not what you could call a small cap company.

[jaknife] 22/4/2024 16:54

PWhite73,

"Jaknife - "You need to use the 10% discount to VWAP part of the formula"

Come on spit it out. What is the VWAP price they are using over how many days and which days?"

I posted the formula in 57,557:

======================================
Share Payments:

For any interest and amortisation payments made in Ordinary Shares (which shall be subject to certain conditions including no potential event of default having occurred and maintenance of a minimum free float), the Ordinary Shares to be delivered shall be calculated by dividing the interest or amortisation amount due by the lower of (a) the prevailing conversion price, in each case on the applicable repayment date and (b) 90 per cent. of the Market Price per Ordinary Share (as defined below)

The "Market Price" is the lower of the arithmetic average of the VWAP for the Ordinary Shares: (i) on the ten (10) trading days, ending on the applicable date or (ii) on the five (5) trading days, ending on the applicable date, but in no event shall it be greater than the VWAP of the Ordinary Shares on the applicable date
======================================


"RNS 18/10/2022 - "Convertible Bond Investor agrees not to sell Ordinary Shares (or any interest in them) nor engage in any short sale transactions in Ordinary Shares (or any interest in them) of the Company during any relevant calculation period, subject to certain exceptions"

As I noted above, the Investor is a subsidiary of a large market maker (Susquehanna). The restrictions that you've posted above apply to "Investor", however, they don't apply to the market maker, which is a separate legal entity.


"No it is not and it's important to understand the difference between the two. Nobody was screaming death spiral finance when this hit 180p in February last year."

We don't agree on this point but you will find that I was noting that this was a death spiral convertible right from day one, when it was first issued and presented in a manner that made people think that it was a genuine convertible rather than a death spiral convertible.

It's amusing but the investor into this death spiral is the same as the investor into the Pantheon Resources death spiral. The PANR shareholders also insisted for many months that it wasn't a death spiral, however, now they accept that it is!

JakNife

[1347] 22/4/2024 16:19

PWhite no matter how many times you argue, it will come back to the same, you may call it what you like, but death spiral finance is what it is. Full Stop. Period. End Of.

[master investor] 22/4/2024 16:14

Sub 40 is the buy zone

[blueball] 22/4/2024 16:05

Strong sell.

[pwhite73] 22/4/2024 15:58

No it is not and it's important to understand the difference between the two. Nobody was screaming death spiral finance when this hit 180p in February last year.

[1347] 22/4/2024 15:21

You can call it what you want, but death spiral finance is what it is.

[pwhite73] 22/4/2024 15:05

Jaknife - "You need to use the 10% discount to VWAP part of the formula"

Come on spit it out. What is the VWAP price they are using over how many days and which days?

Jaknife - "Better than that, the investor into the loan note is a subsidiary of a large market maker (Susquehanna) and market makers are legally permitted to naked short (and are also exempt from the short selling disclosure rules). Hence, between them, the investor and Susquehanna can forward sell the shares!"

RNS 18/10/2022 - "Convertible Bond Investor agrees not to sell Ordinary Shares (or any interest in them) nor engage in any short sale transactions in Ordinary Shares (or any interest in them) of the Company during any relevant calculation period, subject to certain exceptions"

[terminator101] 22/4/2024 14:53

It's death spiral finance. You can't beat the death spiral. It's a guaranteed winner winner chicken dinner for the death spiral finance providers. All they really need is a willing supply of gullible gerbils ;-)

[jaknife] 22/4/2024 14:44

stockhunters,

"why issue shares at 42p when they turned down even more money in the 50p placing?"

Avacta issued a £55m convertible loan note 18 months ago:



The quarterly repayments under the loan can either be paid in cash or shares. If the company elects to repay with shares then there's a formula to determine the number of shares that are issued:

======================================
Share Payments:

For any interest and amortisation payments made in Ordinary Shares (which shall be subject to certain conditions including no potential event of default having occurred and maintenance of a minimum free float), the Ordinary Shares to be delivered shall be calculated by dividing the interest or amortisation amount due by the lower of (a) the prevailing conversion price, in each case on the applicable repayment date and (b) 90 per cent. of the Market Price per Ordinary Share (as defined below)

The "Market Price" is the lower of the arithmetic average of the VWAP for the Ordinary Shares: (i) on the ten (10) trading days, ending on the applicable date or (ii) on the five (5) trading days, ending on the applicable date, but in no event shall it be greater than the VWAP of the Ordinary Shares on the applicable date
======================================


"also can they sell the 42p shares instantly or are they locked in?"

Better than that, the investor into the loan note is a subsidiary of a large market maker (Susquehanna) and market makers are legally permitted to naked short (and are also exempt from the short selling disclosure rules). Hence, between them, the investor and Susquehanna can forward sell the shares!


PWhite73,

"I'm also puzzled as to where they've got the 42p from.

RNS 22/04/24 - "The 15-Day Reset Average Market Price is 50.83 pence"

42p is a drop of 17.5% on 50.83p"

You're using the wrong part of the formula. See above. You need to use the 10% discount to VWAP part of the formula, as I noted in posts 57,542 and 57,549.

JakNife

[pwhite73] 22/4/2024 14:31

Yes they can and I'm also puzzled as to where they've got the 42p from.

RNS 22/04/24 - "The 15-Day Reset Average Market Price is 50.83 pence"

42p is a drop of 17.5% on 50.83p

[stockhunters] 22/4/2024 14:19

also can they sell the 42p shares instantly or are they locked in?

[stockhunters] 22/4/2024 14:18

why issue shares at 42p when they turned down even more money in the 50p placing?

crazy

[loglorry1] 22/4/2024 14:12

Are any bulls at all left here? I was hoping for a bit of a ramp so I could re-short. Does anyone still think Avacta has a reasonable chance of a cure for some cancer patients?

[pwhite73] 22/4/2024 14:09

RNS 18/10/2022:-

Conversion

Initial Conversion Price: 25 per cent. premium to the Offer Price

Reset Conversion Price: The conversion price may be reset down at the date falling 18 months after the Closing Date (as defined in Appendix III) (the "Reset Date") to the price per Ordinary Share equal to the higher of (x) the Offer Price and (y) the then current market price of the Ordinary Shares (determined by a 15-trading day volume weighted average price ("VWAP") of the Ordinary Shares prior to the day immediately preceding the Reset Date) if such price is lower than the then prevailing conversion price

Reset Clawback: Following a downward reset, the Company has the right to reset the conversion price back upwards to the previous conversion price if the daily VWAP of the Ordinary Shares on each of at least 20 trading days in any period of 30 consecutive trading days is greater than 130 per cent. of the Initial Conversion Price at any time during the 9 month period following the Reset Date