Davenham Share Discussion Threads

[mike111d] 23/2/2011 18:25

I really hope that this works out for you all but for me the risk of walking away with nothing remains too great.

[grlz] 23/2/2011 15:32

Jimmy - I have to agree with you, it does look like DAV's Trade Finance business is the focus of everyones interest, inc Kingswood / Moor Park Capital. As I understand it, its basically the only business unit operating intact as the property biz is in run-off enriching solicitors tasked with collection.

I can't see the BoD getting much support from PIs as I noticed today's latest statement has moved from "no value for shareholders" to "it is likely that there will be no value for shareholders' current shareholdings". Indicating a huge dilutive placing and possible side stepping of pre-emptive rights is coming.

I can't see any of the characters populating the current BoD getting any plc jobs in future - a shareholder would be crazy to appoint any of them imho

If DA gets elected with some backing from MT, DAV is worth a punt from these lvls imo - worth watching to see how it pans out

[lufc5] 23/2/2011 14:47

Can sell 200k(not that I will)...but can't even buy 5k!!!!

[lufc5] 23/2/2011 14:20

Update Re Discussions with Major Shareholder

TIDMDAV

RNS Number : 7229B

Davenham Group PLC

23 February 2011

23 February 2011

Davenham Group plc

("Davenham" or the "Company" and, together with its subsidiaries, the "Group")

Davenham enters into exclusive discussions with its major shareholder and agrees a standstill period with its Banking Syndicate

Davenham today provides an update on its announcement on 20 January 2011 in which the Company noted that the Company was in initial discussions with the Company's largest shareholder, Kingswood Property Finance ("Kingswood"), as to whether a reconstruction of the Group may be achievable.

Exclusivity and standstill agreement

The Company today announces that Kingswood and the members of the Group's Banking Syndicate (the "Banking Syndicate") have entered into an exclusivity and standstill agreement (the "Exclusivity Agreement") in order to permit more detailed discussions to take place in relation to the potential reconstruction of the Group which would enable one or more of its divisions to recommence writing new business. Moor Park Capital Partners LLP ("Moor Park Capital"), a potential co-investor with Kingswood in the Group, and the Company are also party to the Exclusivity Agreement.

As part of the Exclusivity Agreement the Banking Syndicate has (subject to certain limited exceptions) agreed with Kingswood and Moor Park Capital not to call in the Group's loans owed to the Banking Syndicate (which are otherwise repayable on demand) until the earlier of 31 March 2011 and the date (if any) on which the resolutions requisitioned by Fitel Nominees Limited to change the Board (as set out in the Company's circular to its shareholders dated 10 February 2011) are passed (the "Standstill Period").

As part of these exclusivity arrangements the Company and the Banking Syndicate have agreed not to enter into any restructuring or refinancing arrangements with any other parties during the Standstill Period. The Company's obligations in this respect are subject to customary carve-outs to enable the Board to deal with any third party approaches that may lead to an offer for the Company or for some or all of its assets (albeit that no such approaches are anticipated) in a manner that satisfies the Directors' duties under applicable law or regulation.

The Board wishes to reiterate its view that, even if Kingswood and the Banking Syndicate reach agreement on a potential restructuring of the Group, it is likely that there will be no value for shareholders' current shareholdings in Davenham.

Irrevocable undertaking to vote against requisitioned resolutions

In order to demonstrate its support of the Board, Kingswood (which holds approximately 29.13% of the Company's issued share capital) has formally committed to vote against the resolutions requisitioned by Fitel Nominees Limited to be considered at the General Meeting on 10 March 2011.

Paul Burke, Group Managing Director, commented:

"Whilst there can be no certainty as to the outcome of these discussions, we are pleased to have the support of the Banking Syndicate to enable more detailed discussions with Kingswood and Moor Park Capital regarding a potential recommencement of writing new business. In light of the exclusivity granted to Kingswood and Moor Park Capital, the Board is working intensively with them to try to maximise the chances of a reconstruction proposal being formally proposed by Kingswood and Moor Park Capital to the Banking Syndicate."

Further announcements will be made as appropriate.

For further information please contact:


Davenham Group plc 0161 832 8484
Paul Burke, Group Managing Director www.davenham.co.uk
Hawkpoint Partners Limited (Nominated
Adviser)
Lawrence Guthrie / Shaun Holmes 020 7665 4642
MHP
Katie Hunt/Reg Hoare 020 3128 8100/07884 494112


This information is provided by RNS

The company news service from the London Stock Exchange

END

MSCDKNDQBBKDPBB

[jimmylufc] 23/2/2011 12:05

grlz - thanks, I'm same as you in terms of no holding but an interested follower of the thread. I note that someone has purchased a further 2% or so over last week (assume DA/TM) giving them 24% against the current boards 29% - I think this puts them in the driving seat as I believe that they will have the private shareholder support in the meeting as well as any further shares they pick up between now and then.

I believe that DA has previously indicated no interest in the property book - so assume that his proposal would exclude this and he would focus on the asset finance/trade finance element of the business.

would be interested in your thoughts on this.

[grlz] 22/2/2011 17:45

UR - As I wrote I don't hold but follow with interest... But to answer your ques, the second requisition is the same as the first, which was been widely briefed by the media e.g. thebusinessdesk.com - AGAIN DAV BoD have chosen not to publish details despite confirming they would per their recent RNS

DA and Murtagh have c.22% Kingswood c.29% being the only support the BoD looks to have secured makes this a very close call.

Its ridiculous to assume the banks will put DAV under on the 31/3 as creditors owe no allegiance to the current BoD only a duty of care to DAVs shareholders - even though, all their interested in is obtaining a maximum payment to clear/reduce the outstanding debt.

Placing DAV into administration without considering a DA led board's proposal would legally limit the banks recovery options if the banks subsequently sold DAVs assets undervalue for example to Kingswood? Standard Chartered v Walker places a duty of care on the lender to examine a debtors proposal before action.

The enormous difference between what is owed and what's available to repay the debt is helpful to DA + TM as it means there is a wide scope to negotiate a settlement.

it will be interesting to see how the vote goes and its outcome - but voting for the status quo is akin to a turkey voting for xmas imho

DYOR

[5uchchi] 20/2/2011 14:32

Sorry Guys I cannot see any RNS stating that bank syndicate has agreed to extend the deadline to 31/03/2011 instead of 01/03/2011. In my own view is Bank syndicate should agree with DA & his colleagues to do the needed/ necessary restructure of the company then share price will shoot upto 25p(Not many shares in issue at the moment & only valued at £1.06M) ----By this stage they can do a Equity issue in order to get rid of the debt atleast by half & at the same time get rid of the bad/rotten apples (Loss making Businesses as well as directors who have no intention of succeeding in this process). I can understand there will be a dilution but thats the best way of getting rid of bad history.By streamlining business and convincing the big Institution that it is now a Long Term prospect obviously more institution will invest.I have't got any shares in this company but keep watching with great interest. Good luck Everyone for the future growth/success!!!!!!!!!!!!!!!!!!!!!!!

[jimmylufc] 19/2/2011 15:30

Understandrisk - agree with your assumption in the final paragraph - makes sense and as you say the bank avoids potential for bad press - has crossed my mind that this might be the route they take

[understandrisk] 19/2/2011 13:24

LUFC5 i see you have reappeared and havent answered any of my questions!! Where is this statement you refer too?

I asked Grlz "you mention the requisitors proposals what are they? - how do you know them? - no answer. Another question is why can DA so much more as a director than not? Kingswood arent asking to be directors -

Do you two have an inside track?

Oh and I strongly suggest you do your DD on Kingswood you are so wrong!!!!!!

IMHO the banking change is purely political on the 31 March they will ask for the money back which they are legally entiltled to do and if Dav cant pay it will go into insolvency as opposed to do something earlier and getting bad press

[jimmylufc] 18/2/2011 19:39

Mike - understand where your coming from - perhaps DA can strike a deal with the bank whereby he takes on the good parts of the business and ditches the property (I believe he has indicated no interest in this part of the business anyway ?), at this point they must have recovered nearly as much as they are going to recover here as they have effectively been collecting in the property book over the last 2 years ?

from LUFC's post appears that they may have a window to do this, ie; 10/3 to end of March assuming ofcourse DA obtains the required vote.

[lufc5] 18/2/2011 13:30

Make of this what you will........

I notice the Davenham Board have yet again failed to post the shareholder's statement on the website, despite Tony Murtagh's request.

Interesting that at the previous EGM they had irrevocables of 34%; now down to 29%, being Kingswood only.

They are still saying the shares will have no value, even after a reconstruction.

The tone of the warning re the banks has changed significantly. The previous statement said:

"It is the firm belief of the Board...that, if the Requisitioned Resolutions are passed, the Banking Syndicate will forthwith exercise its rights under the On Demand Facility to put the Company into receivership..."

Now the Board are saying:

"It is the firm belief of the Board...that, if the Requisitioned Resolutions are passed, the Banking Syndicate will not be minded to extend the maturity of the current on demand facilities beyond 31 March 2011. Failure to extend these facilities is likely to lead to the directors having to file for insolvency."

It seems to me that a lot can be done by the new Board between 10th March and 31st March; also that while the banks are currently minded not to extend, they could be minded differently if they receive satisfactory proposals.

Quite interesting.....wouldn't you say.....

[mike111d] 18/2/2011 13:28

It was a little tongue in cheek but you can see where I am coming from. The bank clearly does not want them around and under the current circumstances I therefore cannot see how shareholders would vote for what in effect would be a likely winding up of the company.

[jimmylufc] 18/2/2011 13:24

I fully agree Mike - but I wouldn't class them as rebels !

that said - not sure I'd like to predict what will happen here - all very uncertain and as we know not a good thing as far as banks are concerned these days

[mike111d] 18/2/2011 13:08

The bank don't seem to see it quite that way according to the RNS statements.

[jimmylufc] 18/2/2011 13:06

Rebels !!

Major shareholders who wish to turn the company around ?!

[mike111d] 18/2/2011 12:53

IMO voting with the rebels would be akin to a turkey voting for Christmas.

[lufc5] 18/2/2011 12:48

I will be back later with some interesting analysis.........

[lufc5] 18/2/2011 12:47

Davenham board warns against rebel coup
18th February 2011
THE board at embattled finance house Davenham has urged shareholders to vote against their replacement at the second extraordinary general meeting convened to remove them in as many months.

The company has sent out a circular to shareholders informing them of the extraordinary general meeting convened by Tony Murtagh - a supporter of former Hitachi Capital CEO David Anthony and ex-Secure Trust Bank CEO Gary Jennison.

He has set resolutions which state that "given the need to secure shareholder value" Anthony and Jennison should be voted in to take charge of Davenham and that current chairman James Kerr-Muir and group managing director Paul Burke should be removed.

In its circular, the board said that the banking syndicate (to which Davenham owed more than £110m when the company provided its last update in November) has indicated that it does not wish to see any changes being made to the company's board.

It said that the banks remain content for the board to continue working with the company's largest single shareholder, Kingswood Property Finance, to assess whether a reconstruction of the group can be achieved.

"It is the firm belief of the board (having discussed the matter in detail with the banks leading the banking syndicate) that, if the resolutions are passed, the banking syndicate will not be minded to extend the maturity of the current on demand facilities beyond 31 March 2011.

"Failure to extend these facilities is likely to lead to the directors having to file for insolvency," the statement said.

The company's current board argued that if shareholders passed the resolutions it would, in their view, deprive them of "any remaining chance of a solvent reconstruction that might see some element of value for the company's shareholders", albeit adding that this remained unlikely.

However, Murtagh argued that the only way that shareholders are ever likely to see a return is if the current board are replaced.

"They keep saying there's no value to shareholders, and that may be the case, but the only way I can possibly see any value will be if Gary and David are voted in," he told TheBusinessDesk.com.

"At the moment, the current board just seem to be working for the banks."

He said that Jennison and Anthony had bought substantial shares in the business through investment of their own capital and therefore had a vested interest in turning the company around, whereas the current board were still being paid significant salaries.

He added that if the current board believed strongly in the prospects for a turnaround, they would forgo a significant amount of their salary in return for shares.

The meeting to vote on the resolutions is due to take place in Manchester at 11am on March 10.

[lufc5] 18/2/2011 11:20

Maybe he has some backing from some of the banking syndicates?...... ;))))

[jimmylufc] 17/2/2011 19:02

Maybe he's talking to the banks druinsky ?

why call the meeting if the banks are not going to support ?

[druinsky] 17/2/2011 18:50

Since the General Meeting on 11 January 2011 the banks leading the Banking Syndicate have
continued to make clear to the Board that:
a) they do not wish to see any changes to the Board; and
b) they continue to be content for the Board to cooperate to the appropriate degree with parties
who might credibly put forward ideas or proposals of interest.



Anthony should take a smack on the bum and move on

[jimmylufc] 16/2/2011 12:25

42k buy according to lse website - could be the start of DA getting his ducks in a row for the EGM ON 10th March

[jimmylufc] 14/2/2011 13:32

It just strikes me that if DA has 22% before the private investors vote he must have a chance of winning this time if the current board achieve the same percentage (34%) as last time. There should be more private investors voting and in view of the current boards comments (re no value, etc) what have the the private investors got to lose by going with DA ?

[understandrisk] 12/2/2011 10:17

Showme - you are bang on the nail. I tried to convey my thoughts on this site before its all emotion and no fact and no one wants to listen. Cut out the emotions and look at the facts. Look at what DA did or didnt do at HC - read the various reports, do some DD in the market (I have!!) oh yes what about Transrent (extracts from the press)

"Some of the £60m worth of assets leased to Transrent are still with end-user hauliers, although Edwards said their details have been provided to lessors. Some 6,000 trailers were leased to Transrent. Funders with the largest liabilities include Barclays, Scania, Clydesdale, Alliance & Leicester and Hitachi Capital UK, the latter reportedly experiencing significant impairments"

"Due to Transrent's problems and the continuing challenging conditions facing the business finance division, Hitachi has decided to make a one-off additional provision of £4m in the fourth quarter"

Great result for the shareholders!!

Anybody asked the question why the parent bought it back? - if he is that good!!

grlz you are so so wrong however I am willing to listen to your arguements but your last comment is factually incorrect. Fact the insovency issue is around Dav Group plc (the circular talk about the company)that company doesnt trade look do your searches its Trust and Trade - they arent going into insolvency IMHO! Fact the threat by the banks is around the management team changing not working with Kingswood so no contradiction. It is clear the banks dont want the management to change

"Since the General Meeting on 11 January 2011 the banks leading the Banking Syndicate have continued to make clear to the Board that:
a) they do not wish to see any changes to the Board; and
b) they continue to be content for the Board to cooperate to the appropriate degree with parties who might credibly put forward ideas or proposals of interest - IMHO Kingswood

Grlz you mention the requisitors proposals what are they? - how do you know them?

No one but no one has put any intel on here about Kingswood I have loads!!! - you should do your own before you vote and those guys who just discuss emotion need think about how they invest