Tekcapital Share Discussion Threads

[davebowler] 25/4/2024 16:21

MicroSalt IPO highlights the value in Tekcapital
The stake in one of its portfolio companies is now worth more than its own market value


February 1, 2024

by Simon Thompson


MicroSalt has market capitalisation of £18.5mn at listing price
Tekcapital retains 77 per cent stake and convertible loan notes
Tekcapital spot NAV more than double its current share price
MicroSalt (SALT:51.5p), a company that produces low-sodium salt, has raised £3.1mn, at 43p, in an Aim initial public offering (IPO). It’s less than initially planned, but in a moribund market for new listings, it is one of the few IPOs to get off the ground (‘Will MicroSalt whet investors’ appetite?’, 3 October 2023).

MicroSalt’s patented solution dissolves much faster on the tongue, so delivers the same sense of saltiness as traditional salt, but uses half the amount of sodium, a major contributor to hypertension and heart disease. The company has created a consumer brand of potato crisps, Salt Me!, which are now sold across 400 retail stores in the US, and has launched its MicroSalt shakers in 450 stores in the US as well as on Amazon in both the UK and US.

Moreover, the company has delivered its first commercial-volume order for a Fortune 500 retailer, which will use the solution for its own branded nuts to be sold across an initial 800 stores. Multiple multi-national companies are currently testing the product and are in price negotiations ahead of placing orders.

In the first half of 2023, MicroSalt reported a pre-tax loss of £1.7mn on revenue of £0.3mn, so it’s the potential to scale up sales rapidly that whets the appetite of investors. Given the obvious health benefits of the patented product, it’s not going to take that many deals with large fast-moving consumer goods (FMCG) customers to ramp up revenue and turn a business with a relatively fixed cost base profitable. MicroSalt looks to have a winning formula.

The IPO is also positive for Aim investment company Tekcapital (TEK:10.25p), which holds 33.3mn shares (77.3 per cent stake) in MicroSalt worth £17.1mn, and $2.6mn (£2mn) of convertible loan notes repayable in December 2025. Tekcapital’s investment in MicroSalt is worth more than its own market capitalisation of £18.3mn.

[888icb] 23/4/2024 13:12

SALT doing well today Up 6%.

[ohisay] 23/4/2024 11:22

Been some chunky buys here yesterday and today ...

[lorse] 22/4/2024 20:05

Mr Oz - are you referring to Micah Richards? Did you notice Jug Ears took the mick out of his glasses on the FA Cup semi-final coverage where Chelsea lost again?

[qsmeily456] 21/4/2024 20:03

Those specs are 💩 like the management🫨

[arthur_lame_stocks] 18/4/2024 13:19

They couldn't even get Eyal Berkovic.

[mr.oz] 18/4/2024 07:04

LUCY
Good signing,that

[mr.oz] 16/4/2024 16:42

Guident news imminent
Inauguration day Thurs 18th
Demos for Star robotic solutions and Auve Tech MiCa.

Gonna be all over the AV news sources, Twitter, X etc.

[qsmeily456] 16/4/2024 14:50

Stupid🌲796;🌳 has been adding since 36p 🫨🤣

Worth buying the chart and selling the ramps here that's it.

💩🐂💩💩 management....Cliff . Needs hanging 2 make a Cliffhanger 🤣

[maytrees] 16/4/2024 09:42

Good morning Mr Oz
Added at sub-8p.

[mr.oz] 11/4/2024 11:38

Well worth a listen

[lord loads of lolly] 10/4/2024 21:29

Backmarker - reasonable or not, it’s what the market currently deems appropriate.

[backmarker] 10/4/2024 16:47

If I have done the maths correctly, then for every share in TEK it holds 0.2226 of a share in SALT.With SALT = 72.5p that would be equivalent to 16.14p for every TEK share.So TEK is valued at about half its interest in SALT alone.Is that a reasonable discount given that TEK cannot readily dispose of its holding in SALT.

[lord loads of lolly] 09/4/2024 16:50

ohisay - either way, a lock in's a lock in. It prevents Tek crystallising any value from its Microsalt holding for at least a year.

Unless Microsalt's taken out in the meantime. Good luck with that one.

[ohisay] 09/4/2024 12:17

Im well aware of the year lock in but that doesnt apply if Microsalt gets an offer it cant refuse .

The lock in is to stop Tek unilaterally deciding to sell shares in Salt as it recently did with Bellescura.

[lord loads of lolly] 09/4/2024 12:08

ohisay - except, Tek's locked into Microsalt for a year, I believe.

So it's kinda irrelevant to work out what Microsalt's worth to Tek at today's prices.

As we've already seen, Microsalt's share price has been pretty volatile since it IPO'd less than 3 months ago. Whilst it's currently still well above the flotation price, it's also around 40% off its 19 February peak. A lot can happen in a year. Both up & down.

[backmarker] 09/4/2024 11:13

Thanks. That's very helpful.

[ohisay] 09/4/2024 10:33

Backmarker ..You can work out Teks Salt valuation in relation to its own market cap from this .

[backmarker] 09/4/2024 09:44

Sounds like Guident-Star is building some sort of Robocop, presumably with the human-in-the-loop being safely elsewhere.

[backmarker] 09/4/2024 01:42

Is it likely that one of the big companies using microsalt would want to buy SALT, or even to buy TEK, to get access to SALT's patents ?

[backmarker] 09/4/2024 01:36

Hi. I'm sure somebody has done the calculation but I have scrolled back and haven't spotted it. So,... if we strip out everything else except TEK's holding in SALT, then how many shares in TEK is equivalent to one share of SALT?

[bill216] 05/4/2024 15:24

Isn't that what a press release is?