Wensum Share Discussion Threads

[pugugly] 06/7/2009 11:47

dell314 et al> Agreed a right royal messup. Unless there were some hidden problems in Wensum it should have been run down for the benefit of the shareholders.
ASorry for all who have got stuffed. a real lesson for shareholders not to commit to binding agreements in respect of takeover/mergers as they locked out any other potential offer, and I know of at least one.

[dell314] 01/7/2009 08:24

If anyone wants advice on turning a company with stacks of working capital into a gigantic cowpat, it looks like these guys are the ones to ask.

And once again, directors end up with the assets and shareholders get ?? Yep, sweet FA.....

Disgraceful!

Rgds
dell

All IMHO, DYOR etc.

[pugugly] 02/2/2009 13:44

anyone like to make an estimate as to how long this will survive?

A classic case (imo & dyor) of management looking after themselves. Should have been run down for cash and stock which would have produced real value for the shareholders at pre merger share price of 15p.

[pejaten] 17/12/2008 20:42

Prof
I was going to buy these a couple of months ago based on the cash backing, so could not agree with you more. Seems madness to me and even if it not they are surely paying too much? Trouble is it seems like a done deal?

[profdoc] 11/12/2008 14:22

Shareholders of Wensum,

We must unite to prevent the reverse takeover of our company by Crown East.
Wensum may not be profitable at present, but at least it has a balance sheet fit to withstand the turmoil of a recession. It also has the capacity to maintain dividends. If it combined with Crown East both the balance sheet and the dividend capacity will be crippled.

Merger with a successful rival might make sense, but merger with what some might call the 'living-dead' Crown East could be very dangerous for Wensum, for the following two reasons:
1. Wensum is making losses. This is no time to be adding Crown East's £2m or so of annual losses to this. The company could be destroyed. The new management are hopeful of achieving synergies; but will the company survive through to the period of supposed synergistic savings?
2. The real killer in the merger proposal is in the balance sheet of Crown East. It has virtually no net assets, a large (and fluctuating) pension deficit and an extraordinary amount of debt. In the event of a merger Wensum cash will be siphoned off to support the debts of Crown East to keep it alive for a few more months.

There is a better way. Wensum should be seen as consisting of two businesses. The first, and most important, is the £2m or so of cash. This should be separated from the other business (i.e. corporatewear). Two financially separate divisions should be created.

The corporatewear division has enough resources in the form of (a) swollen inventories, (b) swollen debtors (use factoring) to service its customers and eventually return to profit. If profits are not attainable then tough love is required. The corporatewear division should not be permitted gradually drain away the value in the cash division. Corporatewear either starts making profits or it will be sold to a competitor (the 'list' being the most valuable asset), or, in a worst case, it will be closed down (not something I say lightly given the employee pain this will induce – we must work hard to avoid this).

The improved management of inventory and debtors will probably permit survival while restructuring over a period of 2-3 years.

The cash accumulated by Wensum (most of which has already been squandered, but at least we can save the £2m) has until now been invested at interest rates of 5% or less. This must change. Once these funds are recognised as the main driving force behind the share price (and not a textile business with constant headwinds) this money must be invested effectively to yield at least 8-10%. Over the next two years there will be many opportunities to build a soundly-based portfolio of shares and other investments. Remember you do not have to make it back the way you lost it! There are other industries with strong economic structures, offering good economic franchises.

So, how do we get from the current downward glidepath to the New Wensum?
1. First the shareholders must rally to elect a new slate of directors. There is surely enough talent amongst us to elect a three non-executives with an executive chairman.
2. The new board must quickly appoint a new managing director and finance director for the corporatewear division. We need a team who can, (a) win the confidence of customers to the point where business is won at rates that produce profits for shareholders, not just shopfloor busyness, and (b) who can devise and employ accounting systems that allow the board to know where in the business value is created – does product line X or customer X produce a rate of return on invested capital greater than the required rate of return for the level of risk (in Wensum's case 9% per annum).
3. We need to appoint a chief investment officer for the cash division (or is that the 'portfolio division'). This role may be undertaken by the executive chairman, if carefully selected.

So, vote against the reverse takeover.

Please write to me ([e-mail]) if you would like to join me in calling for an extraordinary general meeting to elect a new Board – we need 10% of shareholders to support and EGM demand.

Also write to me if you would like to put yourself forward as a potential director.

Please pass on this message to any Wensum shareholders you know.

Professor Glen Arnold
(Professor of Finance and author of The Financial Times Guide to Investing, The Financial Times Guide to Value Investing (2009), Valuegrowth Investing, Corporate Financial Management and Value-based Management (Editor).

[pictureframe] 20/5/2008 14:03

agreed, last set of results show this is on a slippery slope

[pugugly] 19/5/2008 12:28

Starting to look like a dead duck - Loss making - living off old property sales. Anyone got any strong reasons to buy?

[pictureframe] 26/11/2007 10:35

Anyone interested in this? Looks good to me

[pictureframe] 14/11/2007 09:07

Wow dividend yield here is over 7%.....has over £3 million is cash and short term assets of £7 million...stonking buy imho

[mctmct] 04/10/2007 09:11

Results look reasonable. Dividend maintained, and still covered, so the >6% yield looks secure.The management are sorting out the difficulties. New orders are in place ....

[mctmct] 28/3/2007 14:36

It has gone very quiet around here ...

[k4] 10/11/2006 10:29

Fortress Finance Inv Inc is shown as having 17.23%. It has a contact telephone number in Switzerland.

Does anyone know who is behind Fortress? Is it a directors' investment vehicle?

No position at present but ....

s.i.n

[arthur_lame_stocks] 27/9/2006 12:34

Any comments on the results? These could be dirt cheap, another Leeds Group but I would like to know how bad the drop in profit is going to be in the second half and whether this is temporary or not.

[jhan66] 27/4/2006 08:11

Jan'06 results out.

5 A full copy of the Report and Financial Statements is available on the company's website -
www.wensum.co.uk

no it isn't. Just looked.

some good news, some bad
possible takeover of Menswear division
end of major contracts for Corporate division

I really want to know about property situation in Norwich so will wait to unearth full accounts

[jhan66] 21/9/2005 07:48

well I know the results are due. waiting to buy when numbers confirmed.
Wont be today though

[piano man] 03/5/2005 12:16

Some one must know something!

[piano man] 13/9/2004 10:33

Buy and hold, bussiness only needs to tick over on current rating and yield. Director buying does suggest some upside. Now I have paid the spread I shall sit back and enjoy the divi's. Would not consider selling at under £1.

[high noon] 13/9/2004 09:48

Well I decided this was a "buy and hold " at 72p on the basis of a great dividend.I did not factor in any growth potential;but it is now up by 20% and to-days move suggests somebody expects more good news.

[hugepants] 28/6/2004 15:32

Up again and Ive already sold out. Too soon, as usual.

[owenski] 17/6/2004 18:33

caveat emptor

[piano man] 17/6/2004 10:54

well that spread knocks out a years yield.