||EPS - Basic
||Market Cap (m)
Real-Time news about Dealogic (London Stock Exchange): 0 recent articles
|boros10: A good meeting full of lawyers, investment bankers and employee shareholders. I was the lone external investor present!
Rick McHattie, CFO, was very open and answered many of my questions.
My reading of the situation is that the founder investors are in no rush to exit at the current share price and this explains why they chose not to place some of their shares with institutional investors to resolve the problem of the small free float and associated liquidity issues.
The good news is that the Company plans to offer those remaining as shareholders a bi-annual opportunity to buy or sell shares through a broker on a matched bargain basis at a valuation to be determined by an independent valuer. More details will be available when the Company launches the tender offer before the end of September 2011.
Also, the Company is currently evaluating how much equity it can afford to buy-back under the tender. Some third party investors will have to sell because they cannot hold unquoted company shares. Also, some employee shareholders will want to sell shares to realise gains under various share option plans. I estimate we could be looking at a buyback of between 10% to 15% of the equity, possibly higher.
This is good news for those remaining as shareholders as the cost of financing the loan the Company needs to pay for the share buyback will be relatively cheap. Earnings per share will rise significantly, all other things being equal. In the short term I imagine dividends will be constrained until the loan is repaid. Given Dealogic's remarkable cash generative qualities I do not belive it will take too long.
The main worry for private investors is whether the matched bargain dealing arrangements will offer very much in the way of liquidity. Rick said the Employee Share Trust may be able to able to pick up some of the slack if sellers out number buyers. This is double edged for investors, as the main way the Trust will get its money is from the Company itself (e.g. using shareholders cash!). I need to check whether the trustees will be able to waive their entitlement to dividends and capital, so that the shares they hold can be excluded from the calculation of EPS.
The Company has approximately 5.2m unexercised share options in the money, with just over half of these already exerciseable. I imagine this number will come down dramatically as employees seek to cash out in tender offer.
In a people based business like Dealogic it is inevitable that share incentives will be a feature of total employee cost. Our only safeguard as external investors is that the significant founder and executive shareholders will not want to see excessive dilution going forward.
My experience of employee share ownership is that it creates an irresistible force which eventually results in an exit. I reckon we will see a trade sale or listing on NASDAQ in a few years time at a valuation significantly higher than the £3.30 being offered in the tender.
Having met some of the executive team I am happy to remain on board as I believe they have integrity and will not seek to unfairly "exploit" their power.|
|insipiens: Had this from my SIPP broker
"If you wish to sell your holding before the proposed listing cancellation you must do so before 4.30pm on 18th July 2011. The trade will be placed in accordance with our terms and conditions and subject to the standard Stockbrokers commission rates. To sell these shares please telephone us on 0117 980 9800 or alternatively forward us a written letter of instruction 'FAO Dealing Department'. Please note that if the cash consideration of a sale does not exceed the commission payable then the sale will not be executed.
If you wish to maintain your holding you need take no action. You should note that following the cancellation you may have difficulty selling this investment at a reasonable price and, in some circumstances, it may be impossible to sell it at any price. The Board of Dealogic Holdings has announced that it intends to make a 'Buyback facility' available to shareholders following the delisting. The proposals indicated in the notice to shareholders on the 21st June are that the buyback offer will be at 330 pence per share, a premium to the current share price, although there are no guarantees that this will occur, or on these terms. Further details will be sent to you as and when they are announced.
The Board has additionally stated that it intends to facilitate a dealing arrangement following the delisting to allow investors to attempt to trade the shares. Further details concerning this will be given as and when they are announced."|
Dealogic share price data is direct from the London Stock Exchange