African Battery Metals Share Discussion Threads

[loverat] 24/3/2014 10:55

I suspect those who did take a gamble here were those betting that ShareProphet's were wrong (as it most of the time) or were deramping. It is quite unusual for them to get anything right and I think some traders routinely go long on their shorts.

I suppose a timely reminder that ShareProphets can be right on the odd occasion and to research before buying into these risky situations.

[hectorp] 24/3/2014 10:50

EK may win 100K on one bet , you don't hear all the wrong trades he's made.

[mally6] 24/3/2014 09:24

JOHNCRAVEN
to let all the honest insiders out

[simon templar qc] 24/3/2014 09:24

I suspect to frighten a number of short sellers. Sorry for all holders.

[johncraven] 24/3/2014 09:01

wonder why it went up 50% the other day

[p@] 24/3/2014 08:09

Thinking of getting back in.

[loverat] 24/3/2014 07:43

Anyone still in this?

[ochs] 21/3/2014 13:49

I guess the business may continue in some form after 1 April, but the question is will it still be listed and will there be any value for existing shareholders?

[quepassa] 21/3/2014 13:25

I note with interest that the ABM website is encouraging new loans and new business which does not, in my view only, read like a business which thinks that the plug is about to be pulled imminently.




I also note with special interest that this same website link clearly states on the bottom of the page that ABM will be REGULATED BY THE FCA FROM 1st APRIL 2014.

The 1st April is of course after the currently deferred covenant-test date of 31/3/14. Can one rule out that the banks will not yet again be lenient in deferring any covenant test date ?

1196 is a good post.

However, ABM is somewhat regulated.

The requirements perhaps for any NEWCO to get similar registrations for a similar type of business may or may not be onerous and time-consuming.


ALL IMO. DYOR.
QP

[johncraven] 21/3/2014 12:48

This looks like its it then.

[grahamite2] 18/3/2014 07:50

A rescue of the company is not, of course, necessarily a rescue of existing shareholders.

[cn100] 18/3/2014 07:43

The Times
Rumour of the Day: Officially, it's not a done deal, but a
51% jump in Albemarle & Bond shares is a decent sign
that a rescue of the stricken pawnbroker is in the offing.
Fortress, the investment firm, is reported to be in talks
with Albemarle's banks, Barclays and Lloyds, although
the company remained tight-lipped. The shares closed
up 3½p at 10½p.

[deanmatlazin] 17/3/2014 09:18

Maybe rise in gold price might give ABM a life line. You never know!

[overeager] 16/3/2014 20:45

Que Passa's post has prompted me to go back and have a good read of the latest published accounts to June 13 (Released 9 Dec 13). The balance sheet is especially interesting to me. Strip out the intangibles and you've still got a company with significant net assets - it doesn't look like a company that has no future. Net current assets stood at £30m plus it had property of £14m.

I note that they had about £20m of gold on the books at the time. Since then, gold dropped in value substantially but is now back to similar levels. It is certainly about £100/oz higher than at the time of the failed rights issue. I can see why investors then would have had concerns as the gold stock would have had to be written down by approx £3m, wiping out any operating profits generated and causing the inevitable covenant breaches. Of course, they probably have sold some gold to keep within lending limits but hopefully not too much because when winding down the lending book that should be cash generative if anything.

So, rumours of ABM's demise may have been exaggerated IMHO, No advice intended as this is strictly one for the brave.

[johncraven] 14/3/2014 14:07

what news is due monday please

[johncraven] 14/3/2014 13:27

que passa - yes great post and easy to read and understand your opinion.

Is there news due on Monday Smraynot???????

[smraynot] 14/3/2014 12:27

Great post QP. Agree £40million mc is peanuts for the city, and we may well have some VERY good news on Monday!

[quepassa] 14/3/2014 11:57

Vulture funds like corpses and they expect to pay accordingly for a bag of bones.

It would appear to me on the other hand that ABM has a discernible pulse, albeit a weak one.

Surely a quick shot in the arm by way of partial recapitalisation would help breathe life back.

ABM gorged too quickly and rashly bloated themselves out in the gold feast by opening too many new shops and sites. If they rapidly trim themselves back down to something approaching their former size, the underlying business should, in my view only, be sustainable.

There has been no suggestion from what I can see of any inability whatsoever to meet current interest payments on bank debt. The problem with the covenants is seemingly technical at this juncture in so far as it is an earnings-based covenant test which has been the rub. The banks know this and have apparently been very flexible on any potential technical breach by repeatedly deferring the exam dates for the earnings test.

The bit of the equation which intrigues is kicking the tyres. I have telephoned several of the established ABM branches and the answer is always the same. They are open for business, taking new pledges and advancing money. So it seems that HO has not put the shutters down on new business in the shops ( unlike their on-line Cash Window). Or the staff are all being kept in the dark.

Frequently in the final throes of many a corporate life/death struggle, most business is halted but apparently not here. ABM latterly even went to the trouble/expense of rolling out a new web-site. See their Twitter for 29th. Jan.

If memory serves correctly, all or most of the senior management of Express Dairies kept their jobs in the Arla take-over, having ultimately recommended to shareholders a price which may or may not be the subject of much debate as to its generosity or otherwise.

Express/Arla was not a distress situation but one can always learn from other M&A situations which may or may not be of experiential relevance to forming opinions elsewhere.

Gold has risen a not insignificant amount recently. This is good for ABM. Additionally, many johnnie-come-lately small payday lenders will likely soon fold due to incoming onerous regulatory requirements. This may further take a little competitive pressure out of the steamer for the established players.

In terms of shorting activity, the action was from 300p down to 10p. Earlier posts refer. The final 10p is flipping a coin. Personally, I see ABM surviving in one guise or another. I may be entirely wrong.

The whole company is valued at about £5m at this point in time. You can't even buy a half-decent house in Hampstead for that nowadays. That is peanuts in City terms or for a large/international suitor. Surely the business should be able to support £20-40million of debt in normal circumstances with an appropriately structured covenant package and a right-sized estate of shops.

I posted heavily some years back about Cattles which had horrific losses and ultimately failed. Having watched this closely, I am now somewhat mindful not of Cattles but rather of Thomas Cook.



No advice of whatever nature intended or given. This is purely my opinion only.

ALL IMO. DYOR.
QP

[mcbull] 14/3/2014 11:43

or 20p from the chart

[hectorp] 14/3/2014 10:53

So it was priced as failed at 7p , fire sale value. From its highs, it might be worth 5, 10 or 15p. Interesting for some.