Spark Ventures Share Discussion Threads

[capt bligh] 04/7/2013 17:25

hxxp://www.forbes.com/sites/roberthof/2013/07/02/with-new-execs-openx-bids-to-make-ad-tech-enterprise-ready/

Hmm....pieces are coming together here soon enough...who knows.

[badtime] 04/7/2013 10:59

much lower and i might buy back in

[pog1234] 02/7/2013 13:44

Azalea, you have to look at the true value of the portfolio to asses the value of the company, consider the following;

The operating cashflow was £-1.2M for the previous 6 months, this will decrease the NAV going forward (perhaps £1M per 6 months)

Take Gambling Compliance as an example, their holding is valued at £1,986K. Last year 28% was valued at £1,776K. That implies a value of £6.3M for 100% of the shares. That is quite a lot for a company that has never been profitable and;
-that has many competitors
-does not provide a service that is materially different from any other competitor (no competitive advantage and low barriers to entry)
-is more expensive than the competitors (no room to increase prices)
-there is a limited market, i.e. little room for a massive expansion

If SV applies the same valuation to its other portfolio companies the NAV could be considerably overvalued. The same applies if the NAV is understated, i.e. they are able to sell for a higher value than the book value. It all comes down to their ability to realize value from their shareholdings, i.e. find a buyer that is willing to pay more than the book value. I am not convinced they will be able to do that, but I haven´t looked into their big holdings very carefully (IMImobile, Notonthehighstreet and Kobalt) so I may be wrong.

[azalea] 02/7/2013 12:12

The last NAV date 30/9/12 produced a figure of 16.16p. Even the current estimated figure is 13.46p. The current discount is given as 25%.

[pog1234] 02/7/2013 10:17

The update years before that was later in July, so no worry yet.... :)

I agree that some of the portfolio companies are valuable, it is just problematic to assess what they can sell them for and compare the value of the parts to the share price.... my worry is that they have to sell them cheap in order to unwind the company. Lets say they sell two of the "good" companies, that leaves a bunch of less valuable companies. Is it worth extending the "life" of the company (in order to find the "right" buyers) when you own less good assets, perhaps it is not justified from an economical perspective? Maybe it is better do do a firesale of the rest of the portfolio companies? If you have that view you need to discount the value of the portfolio quite a lot.

[jlo10] 02/7/2013 10:06

Not sure about Gambling Compliance and Firefox but from what I can glean the other companies in the portfolio seem to be going well or very well.
Just slight worry that we have not had the update - it was in June last year

[philjeans] 02/7/2013 09:52

Because there are so few buyers.

Simple as that.

Investors can't see an exciting story - but the latent worth is there, have no doubt.

And now would be a very good time to load up IMHO.

But DYOT.

[nickelmer] 02/7/2013 06:54

In that case, why is the share price performing so poorly?

[philjeans] 01/7/2013 17:17

Disagree; US tech businesses are often sold and floated whilst still heavily lossmaking.

It all depends on the growth potential.

This portfolio, overall, looks VERY undervalued to me.

[nickelmer] 01/7/2013 17:10

My thoughts are that the share price tells the story, they have been puffed up a few times by the tipsters, but tipsters aside the lack of real news and soggy share price seems to suggest that they may finding it more difficult to sell off their investments, as pog points out selling a non profitable business cannot be easy.

[pog1234] 01/7/2013 13:34

Thanks smarm, I just had a look at the no of companies, 10, in which SPK currently is an investor and, considering the speed at which they have divested other holdings, I did not find it realistic that they would be able to sell all of them in just one year.... at least not without a big firesale.

Perhaps my thinking is wrong but that was just my initial thought. I am just trying to find an angle where I can earn some money :) . And a company that has stated that it will unwind its business within a year is not very usual and therefore I think it is very hard to accurately value the company. This might open up for some very good opportunities if you can spot an under/overvaluation, hence my question.

Looking at the the different holdings I have difficulties to assess the value of each of them. A few are most likely valuable, but others are perhaps less valuable or impossible to sell (without a hefty discount). Take gamblingcompliance, a company with (according to their web site) 30 staff, catering the global gambling industry. They have been around since 2007 and are not profitable?, they say the company is cash flow positive, is growing etc but no details have been provided. I have some inisght into the gambling industry and there are many companies that provide similar services as gamblingcompliance at a much lower price. I can´t see how they will make any serious money out of that business. Perhaps I am wrong, I would be very interested to hear any opposing thoughts.

[smarm] 01/7/2013 07:58

Pog - I agree with azalea but to answer the question, they will most probably hold a vote and extend the winding up period.

[azalea] 30/6/2013 13:20

Why should they not be able to sell all their assets if the price is right. The U.S. economy should show gathering strength in H2 and 2014 could be even better.

[pog1234] 30/6/2013 12:40

What will happen to the holdings they do not manage to sell before the winding up of the company?

[smarm] 29/6/2013 18:07

blondeamon - good job they are winding up then.

S

[blondeamon] 29/6/2013 18:04

Go where? To the bottom? Perhaps.


Any company who forgets to put out a serious RNS for 6 months is doomed to fail.

[james dean] 29/6/2013 17:43

Not long to go IMHO.

Regards.

DYOR

[blondeamon] 28/6/2013 16:34

This management has fallen asleep and they forgot to replace them...

[azalea] 28/6/2013 09:33

The gathering signs of a recovery in the U.S. economy should further strengthen the value of SPK assets.

[nickelmer] 27/6/2013 07:10

No news is not usually good news sadly.....

[blondeamon] 26/6/2013 15:09

In the darkness here...it's insane to not announce when your company will publish results. It's been 4-5 months with no news at all.

[smarm] 26/6/2013 08:26

Sharescope shows prelims (unconfirmed) 1/7/13.

S

[nickelmer] 26/6/2013 07:50

Maybe that's it, maybe they have not sold at all, thus delaying repayments and hence why no report yet

[blondeamon] 25/6/2013 21:32

Can't be, the past 5 months the markets were booming so on the contrary they had all the opportunities to sell in a bull market! I doubt they sold in the past 20 days.

Quite a drop today, let's see where it starts tomorrow. Aren't we due news this week?