Share Name Share Symbol Market Type Share ISIN Share Description
Teliti LSE:TEL London Ordinary Share KYG8753W1042 ORD USD0.10 (DI)
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  +0.00p +0.00% 39.50p 0.00p 0.00p - - - 0.00 05:00:10
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Software & Computer Services 536.5 -16.8 -119.0 - 9.99

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DateSubject
02/4/2007
17:29
blank frank: The Maintel share price is going from strength to strength; at 216.5p it's at another all-time high:- And MAI directors have consistently increased their interest in the company:- 02/04/2007 10:53 UKREG Director/PDMR Shareholding LSE:MAI Maintel Holdings Plc http://www.advfn.com/p.php?pid=nmona&cb=1175534390&article=20056389&symbol=L%5EMAI 01/03/2007 09:30 UKREG Director/PDMR Shareholding LSE:MAI Maintel Holdings Plc http://www.advfn.com/p.php?pid=nmona&cb=1175534390&article=19610321&symbol=L%5EMAI 01/02/2007 12:05 UKREG Director/PDMR Shareholding LSE:MAI Maintel Holdings Plc http://www.advfn.com/p.php?pid=nmona&cb=1175534390&article=19213009&symbol=L%5EMAI 03/01/2007 12:46 UKREG Director/PDMR Shareholding LSE:MAI Maintel Holdings Plc http://www.advfn.com/p.php?pid=nmona&cb=1175534390&article=18626531&symbol=L%5EMAI 30/11/2006 15:41 UKREG Director/PDMR Shareholding LSE:MAI Maintel Holdings Plc http://www.advfn.com/p.php?pid=nmona&cb=1175534390&article=17892717&symbol=L%5EMAI 10/01/2006 09:25 UKREG Director/PDMR Shareholding LSE:MAI Maintel Holdings Plc http://www.advfn.com/p.php?pid=nmona&cb=1175534390&article=13731370&symbol=L%5EMAI 21/12/2005 14:51 UKREG Director/PDMR Shareholding LSE:MAI Maintel Holdings Plc http://www.advfn.com/p.php?pid=nmona&cb=1175534390&article=13590475&symbol=L%5EMAI Meanwhile, AT communications has bounced back well in the last month:- And ATCG announced today that EIGHT ATCG directors/managers have today bought shares in the company at 39p a share:- 02/04/2007 14:17 UKREG Director/PDMR Shareholding LSE:ATCG AT Communications http://www.advfn.com/p.php?pid=nmona&cb=1175535428&article=20061274&symbol=L%5EATCG The company has also just raised c. £2M. gross in a placing at 37p a share:- 02/04/2007 07:07 UKREG Placing of Ordinary Shares LSE:ATCG AT Communications http://www.advfn.com/p.php?pid=nmona&cb=1175535802&article=20052663&symbol=L%5EATCG B.F. P.S. BF2 - have you changed your e-mail address? - Delivery to the following recipients failed: blindfaith2@fsmail.net
12/9/2006
19:12
blank frank: Welcome to the new TEL thread Kimboy2 - nice to hear from you again. I fully agree that a strong TEL share price and healthy rating is important to an acquisition strategy, and I believe that TEL's directors fully realise this. Fortunately, the TEL share price is now moving in the right direction, and a good set of final results should help to continue that. Acquisitions are though only part of TEL's 'story' - organic growth alone I believe makes this an exciting investment. B.F.
06/9/2006
19:44
blank frank: A BRIEF OVERVIEW OF TEL'S LAST TWO YEARS, ESPECIALLY FOR NEWBIE TEL INVESTORS:- [N.B. All share prices have been adjusted as necessary for TEL's 50 into 1 share price consolidation last month.] I've tipped this share earlier at higher prices, initially after it floated in September 2004 at 175p. As it turned out I was too early, as the share price performance has been a disappointment (although the fundamental progress of the company has been very encouraging). The share price / company performance has I believe probably been depressed by 3 main factors, 2 of which were just bad luck:- 1. Overhang from Enterprise North (formerly Mosaique). MQE apparently became a large holder of TEL in TEL's 9/04 IPO, but shortly afterwards MQE ran into serious problems and became a distress seller. However, ENTH's interim results on 22/12/05 revealed that it intended to complete the disposal of its remaining investments by 31/3/06: http://www.londonstockexchange.com/LSECWS/IFSPages/MarketNewsPopup.aspx?id=1131087&source=RNS Most recently, ENTH's trading statement on 4/8/06 stated that: "The Company has now realised substantially all of the investments it previously held and therefore no longer has any trading activities." http://www.londonstockexchange.com/LSECWS/IFSPages/MarketNewsPopup.aspx?id=1275198&source=RNS 2. Ian Leask, TEL co-founder and Head of Sales, died suddenly in 3/05. This apparently had some short-term impact on the company's performance. However, the CEO's report in December stated that: " ... Ian's example and contribution will not be lost as the sales and marketing team, built up over the last two years, continues to perform at the highest levels in the future." 3. Higher cost of technical personnel and infrastructure now needed to provide the more sophisticated solutions to the larger corporate accounts. Initial costs were borne by TEL, and now the benefits of the contracts concerned are starting to show through in TEL's improved financial performance. Now that these issues have been effectively 'weathered', I believe that the TEL share price will perform well. TEL made three acquisitions during the calendar year 2005, the second one of which resulted in Ed Smyth becoming a director and major shareholder of TEL at a deemed price of 150p/share. As part of the agreement, ES will not dispose of any shares in TEL if the shares are below a price of 350p/share (except with the consent of the Board which may only be given in exceptional circumstances). This compares to a current TEL share price of 71.5p/share. ES has a formidable track record. Until 1997, he was a director of Amec Building Limited, part of the Amec Group. He left Amec Building Limited to start his own business in the consultancy management sector, Alba Management Consultants Limited, in 1997. In 2000 Alba Management Consultants Limited and Stiell Limited, with investment and other support from 3i, came together to form an enlarged group called Stiell Group whose clients included BT, Royal Sun Alliance, Abbey National and Canary Wharf. In 2002, the merged business of Alba Management Consultants Limited and Stiell Limited, of which ES was the largest shareholder, was successfully sold to Alfred McAlpine plc for circa £85 million. TEL has preferred partner status for telephony and data transmission services for the clients of ES's new company, the clients of which company include MacDonalds, McAlpines and Compass Group. Regarding this, TEL's CEO's report last December stated that: "... I am confident that through this association and alliance the Company will not only benefit from new blue-chip clients becoming customers of TMG, but also the ability, as the board has declared its intention, to widen our support services offering. ... " TEL's annual report for the year ended 31st. July 2005 also highlighted that the company is already benefitting from the burgeoning VoIP market:- "Analysis of Principal Revenue Streams Maintenance 35% New systems inc VoIP 38% Additional equipement and services 17% Call billing 10%" "The CEO's report Jeff Williams ... We are competing at the highest level in the converged voice and data market and our expertise will ensure that new and existing cusomers are confident of TMG's ability to take them along their technology road map. ... " TEL has 'top performing reseller' and 'best technical support' awards from SpliceCom, as an accredited seller and maintainer of one of the first truly VoIP telephony products manufactured by SpliceCom. Since floating TEL has announced the winning of several major contracts, and a major contract extension (Travis Perkins):- 05/11/2004 09:21 UKREG Award of contract http://www.advfn.com/p.php?pid=nmona&cb=1157571151&article=9288237&symbol=LSE%3ATEL 19/01/2005 11:21 UKREG Award of contract http://www.advfn.com/p.php?pid=nmona&cb=1157571151&article=10015564&symbol=LSE%3ATEL 14/02/2005 09:00 UKREG Award of contract http://www.advfn.com/p.php?pid=nmona&cb=1157571151&article=10335237&symbol=LSE%3ATEL 07/06/2006 12:47 UKREG Re Contract http://www.advfn.com/p.php?pid=nmona&cb=1157571306&article=15700645&symbol=LSE%3ATEL 15/06/2006 11:00 UKREG Trading Statement http://www.advfn.com/p.php?pid=nmona&cb=1157571306&article=15797004&symbol=LSE%3ATEL B.F.
14/8/2006
17:47
blank frank: Has SteMiS changed his mind about TEL's likely rating when (or if) it achieves earnings?:- SteMiS - 12 Nov'04 - 11:01 - 27 of 339 "blindfaith2 Strange as it may sound I am hoping that the share price does come off a bit on the results as I would like to buy some more. Whilst I think there is excellent value to be had at 3.75p, the spread is truly awful and I would quite like to be in at the warrant exercise price of 3.5p (so far my average purchase price, inc costs, is 3.7p). However it will be a tough call as to which has the most impact; the results or news of another contract! Personally I am in this for at least 2 years (initially to maximise taper relief). Hardman's forecast for 2006 is turnover of £5.85 million and net profit of £480,000 (EPS of 0.6p). With a fair wind, more contract gains and some bolt on acquisitions, I don't see why they can't beat this by a good margin. If they do and with the growth rate that this will have demonstrated then I would be hoping for a share price of 10-15p. Just my opinion of course." http://www.advfn.com/cmn/fbb/thread.php3?id=7377347&from=21 SteMiS - 5 Aug'06 - 20:59 - 539 of 540 "jonwig Even though TEL has significant (?) tax losses, I always like to calculate EPS after a notional tax charge as I don't think the market gives full credit for tax losses. Of course they do have value so need to be taken account of somewhere. I also like to use [Taxed EBIT]/[Enterprise value] as a ratio. You could I suppose adjust Enterprise Value for the NPV of the tax losses. Superficially if TEL made an EPS of 0.36p then a P/E of 8-10 would value the shares at 3-3.5p. However if you use Taxed EBIT/Enterprise Value of 8-10, even adjusting for tax losses, you would be pushed to get above 2.0p" Previously, SteMis hoped that 2006 eps of a good margin above 0.6p (say 20% above, i.e. 0.72 eps) would give a TEL share price of 10p to 15p. Now however, he feel that 2006 eps of half that would struggle to give a TEL share price of 2p; whereas pro-rata it would equate to a share price of 5p to 7.5p. B.F.
21/7/2006
18:54
blank frank: I received my hardcopy of the EGM etc. document today. Here are some key extracts:- " ... The Company is prohibited under the Companies Act from raising funds in the market at less than the nominal value of the Company's Existing Ordinary Shares. The closing middle market price of the Existing Ordinary Shares on 18 July 2006, the last practicable day prior to the posting of this circular, was 1.125 pence. The effect of the Capital Reorganisation will be to significantly reduce the number of shares in issue and to create New Ordinary Shares with a nominal value of 5 pence each. On the basis of the closing middle market price as at 18 July 2006, the last practicable day prior to the posting of this circular, it is expected that the market price of the New Ordinary Shares following the Capital Reorganisation will be approximately 56.25 pence, reflecting the significant reduction of shares in issue, hence enabling the Company to raise funds in the market for acquisitions and organic growth purposes. ..." " ... The overall effect of the Capital Reorganisation and the Share Capital Reduction will be to reduce the number of ordinary shares in issue, on the basis of 1 New Ordinary Share for every 50 Existing Ordinary Shares in issue and to increase the nominal value from 2.5 pence per Existing Ordinary Share to 5 pence per New Ordinary Share. ... " "Recommendation The Directors, who have been so advised by Rowan Dartington, the Company's nominated adviser and broker, unanimously consider that the Capital Reorganisation and the Share Capital Reduction is in the best interests of the Company and the Shareholders as a whole. In providing advice to the Directors, Rowan Dartington has taken into account the Directors' commercial assessment of the Capital Reorganisation and the Share Capital Reduction." B.F. Comments:- * There's no explanation in the document of why issuing shares at or near the current share price (or its post-consolidation equivalent) would be in the best interests of shareholders. Indeed it's hard to see how this could be justified. Unless the company is running out of money, or there is an earnings enhancing acquisition available which would be lost through waiting, I don't think it is justified ... and probably neither of those two situations apply. * However, the additional flexibility to issue shares at say £1 (2p equivalent pre-consolidation), which would currently not be possible, might be in the best interests of shareholders. That would be nearly double the current share price, so is a big difference. * The effective lowering of par value will I believe also enable the company to issue share options at a lower price, because I believe that the par value restriction applies to options too. Last August (before the big share price rise then) the company issued a swathe of share options to directors; this was not shown in the 2005 preliminary results issued to the LSE, but was only shown in the hardcopy 2005 report and accounts. The options price wasn't shown, but I assumed it was at par (2.5p). * The cause of the recent TEL share price decline to well below par value, which has brought about this proposed change in par value, appears to have been minor retail selling by small TEL shareholders. Rowan Dartington apparently told TEL not to answer questions from individual shareholders (according to 4/5/06 e-mail from Jonwig) ... quite a few of whom have probably been shareholders in TEL for about twice as long as RD as been its NOMAD. I myself have been trying to obtain RD's research on TEL for over a month; when I spoke to RD's John Wakefield on the phone, his primary concern appeared to be whether I was a RD client or not ... he then asked me to e-mail him, which I did three times (22/6, 5/7, and 11/7), with no reply, so that I had to phone in again. If this is their standard treatment to individual TEL shareholders then the share price collapse is no surprise. I think that TEL is a great company with a great business, but it seems to be let down by its investor relations, especially from its NOMAD. B.F.
21/6/2006
19:20
blank frank: SteMiS - 21 Jun'06 - 08:30 - 460 of 465 "Although they issued the 7.5M to the vendors of Westcom at 4p, the placing of 20M shares for 'working capital' was at 2.5p. If you net off the costs of the placing from the proceeds, the net price was only 1.41p Similarily TMG issued 18M to acquire Clansey and 23.4M to acquire Cassydora. All at 2.5p. The face value of these shares (at 2.5p) was £1.035M. The costs associated with these was £0.352M (or 0.85p per share); a net 1.65p per share. All were discounts to the share price at the time. ... " Dear oh dear SteMis; posting false information onto public bulletin boards really is a bit naughty you know ... TEL's last acquisition, of Westcom, was announced on 28th. October 2005 when the prevailing market price was 2.375p. A subsequent announcement on Monday 31st. October revealed that TEL had issued 20 million shares for 2.5p cash each, and 7.5 million to the Westcom vendors at a (non-cash) price of 4p per share. http://www.londonstockexchange.com/LSECWS/IFSPages/MarketNewsPopup.aspx?id=1095758&source=RNS I.e. the share issues were at a PREMIUM, not a discount. In addition, only a minority of the 20M. share cash placing was for working capital: £350K. of the £500K. was paid to the vendors of Westcom as the cash component of the acquisition. The Cassydora acquisition and share issue was announced on 19th. August 2005, before market opening. TEL was 2.2p or less all 18th. August, and even on 19th. August traded no higher than 2.5p. The shares however were issued at 3p a share. http://www.advfn.com/p.php?pid=nmona&cb=1150913442&article=12224168&symbol=LSE%3ATEL I.e. these shares were also issed at a PREMIUM, not a discount. The Clansey acquisition and share issue was announced at 9a.m. on 14th. February 2005, with shares issued to Hoodless Brennan for 2.5p a share. That was c. 13% less than the market price prior to 14th. February (2.875p), but may have been set when the share price was 2.75p shortly before (i.e. a c. 9% discount to that). http://www.advfn.com/p.php?pid=nmona&cb=1150914962&article=10335236&symbol=LSE%3ATEL This was therefore the only one of the three placings which was at a discount, and only a small one. And Hoodless Brennan rapidly sold the shares on at a higher price (above 3p). As regards the costs of the fundraisings, Greg Hallett of TEL has told me that the costs of the Westcom placing, as with the Clansey one, were very low. From memory, somewhere in the region of £10K. to £20K. each, I believe. This being the case, I believe that the interim results may give a misleading impression on this. The relevant part from the interim results is:- "Expenses in connection with issue of equity share capital (218)" http://www.londonstockexchange.com/LSECWS/IFSPages/MarketNewsPopup.aspx?id=1203596&source=RNS I posted shortly after the interims, in response to another poster:- Blank Frank - 25 Apr'06 - 17:33 - 360 of 465 edit " ... I can't believe that TEL paid £218K. to raise the money for Westcom - a tiny fraction of that surely?" I believe that the £218K. probably includes the expenses in connection with the Cassydora acquisition too, which took place in the same interim period. The amount may also involve 'indirect' expenses, as opposed to just commission. As a total sum for two sizeable deals, it doesn't look unreasonable. I've got no idea where or how SteMis got the figure of £0.352M for the costs of the Clansey and Cassydora acquisitions, but he must have come up with it himself as these two acquisitions were in different TEL years. It doesn't look at all right to me, and judging by the gross innacuracy of some of the other information he has posted, I think it's safe to assume that it is wrong. Has he simply confused it with the cash payment for Clansey?!:- " ... The consideration will be satisfied by #325,000 payable on completion in cash ... " http://www.advfn.com/p.php?pid=nmona&cb=1150914962&article=10335236&symbol=LSE%3ATEL Knowing TEL's management as I do, I don't believe that they will issue shares at or near the current low level of 1.375p. The key players amongst them are major shareholders themselves, and have no wish to overly dilute themselves, and to give away chunks of their company (that they have poured their blood, sweat, and tears into)on the cheap. I know that they also care about other shareholders, and I don't believe they are the sort of people who would wish to 'shaft' other shareholders. That's why I believe that any share issue won't be at less than the current par value of 2.5p - especially as I believe that there is a legal restriction on issuing shares at below par. The bullish TEL announcements of 7th. and 15th. June on contracts and current trading were hardly the act of a company that wishes to see its share price fall! Will anyone wish to subscribe at 2.5p, if the market value is significantly less? I think it's quite possible, as in other cases where the market value has been depressed to a silly low level by minor retail selling. But if not, I believe that TEL will simply wait. Another bolt-on acquisition may be a nice bonus, but is far from essential, certainly immediately. And to make an acquisition that won't turn out to be earnings enhancing would be self-defeating. I believe that the company was monitoring Clansey and Westcom for a year or more before acquiring them, in order to be certain that they would be good buys. TEL is not therefore a company that is too impatient to wait if appropriate before making an acquisition. B.F. P.S. In a year or so I believe that many investors may well look back at the current TEL share price with gnashing teeth, saying "if only I'd bought then ... "!
14/1/2006
18:48
blank frank: Blank Frank - 2 Nov'05 - 19:48 - 75 of 113 " ... We previously speculated on the old TEL thread that TEL was suffering from an overhang from Mosaique, after Jonwig flagged up the possibility. ... Mosaique changed its name in May to Entreprise North PLc. Since then there has been no further announcement, and their share price has fallen further, to 5.5p - market cap. now just c. £0.43M. It may therefore still be experiencing problems, and selling TEL shares if it has any left? ... " I see that Enterprise North announced its interim results on 22nd. December. http://www.londonstockexchange.com/LSECWS/IFSPages/MarketNewsPopup.aspx?id=1131087&source=RNS These reveal that in the six months to 30th. September 2005, the company disposed of a further £25K. of investments held. And that it intends to dispose of all the rest by the end of the financial year. The value of these investments is shown as being £49K., which is down massively from £802K. a year earlier. The final results suggest that much of this reduction was due to write-downs; and show that the value of the investments at 31st. March 2005 was £74K. All of this suggests that the company has indeed been selling its TEL shares, along with its other investments, but that the selling is nearly over (at least in terms of time). Any TEL shares remaining ENTH intends to have sold by 31st. March 2006. B.F. P.S. It would be interesting to speculate what the TEL share price might have been but for this overhang! The overhang was plain simple bad luck, as with the death of Ian Leask. But TEL now appears to have 'weathered the storm'. P.P.S. TELEPHONE MAINTENANCE GROUP PLC AIM ADMISSION PROSPECTUS DATED 24 SEPTEMBER 2004 PART V ADDITIONAL INFORMATION "10. Material Contracts [EXTRACT] 10.2 a loan agreement dated 21 September 2004 between (1) Mosaique Plc (''Mosaique'') and (2) the Company whereby Mosaique made an unsecured interest free loan of £250,000 to the Company which, subject to Admission taking place no later than 31 October 2004, will be converted by the Company into Ordinary Shares as part of the Placing at the Placing Price. In the event that Mosaique procures placees for the purpose of the Placing in excess of £150,000 the difference between this amount and £150,000 shall become repayable by the Company to Mosaique;" This suggests to me that Mosaique had at least £150K. (at 3.5p) of TEL shares after TEL's floatation: about 4.28 million shares or more. If the number of ordinary TEL shares in issue at admission was about eighty million, that would mean that Mosaique owned at least 5% of TEL. But if so, ENTH's accounts suggest that they must have sold at least half of these shares, even if the remainder accounted for all of ENTH's £49K. of investments on 30th. September (and even if their value had been written down a bit). This being the case, why no announcement from MQE/ENTH about these sales? I believe the rules state that there should be such an announcement when a holding crosses any percentage of company ownership above 3%. Such an announcement might have warned early TEL buyers of the overhang, and saved them losses ... although this would probably have meant that MQE/ENTH got less than otherwise for its sales. [N.B. MQE had £74K. of investments on 31/3/05; at that point there were about 98 million TEL shares in issue, following TEL's Clansey dilution; and at that point the TEL share price was 2.875p. Even if all of that £74K. was TEL shares, and their value had been written down to 2.875p, MQE could have had no more than about 2.6million TEL shares at that point - about 2.65% of the company. Even if MQE had just sold down to a 5% TEL holding before the Clansey dilution, that dilution (of about 22.5%) would still have left MQE with a holding of more than 4% of TEL.]
02/11/2005
19:48
blank frank: The TEL share price has fallen an eight of a penny today to 2.25p, despite just one trade of 10,000 for 2.45p - presumably a buy. Judging from the past pattern, this suggests that more shares are waiting in the wings for sale. We previously speculated on the old TEL thread that TEL was suffering from an overhang from Mosaique, after Jonwig flagged up the possibility. Blank Frank - 3 Mar'05 - 20:37 - 220 of 339 " ... For some time now - since latter 2004 - there seems to have been unusually large TEL sales volume. This took me by surprise - I couldn't really work out where all those shares were coming from. There seemed to be too many to be accounted for by post-IPO purchasers selling, but the main pre-IPO shareholders were locked in. That mainly just left the IPO placees themselves - but why subscribe at 3.5p, and then sell shortly afterwards, sometimes at a sizeable loss, when TEL is doing well? 'Distress' selling by Mosaique could well explain things. The timing also looks right - Mosaique only seems to have reported its difficulties in mid December, which is when the TEL share price really began to be hit hard. ... " Mosaique changed its name in May to Entreprise North PLc. Since then there has been no further announcement, and their share price has fallen further, to 5.5p - market cap. now just c. £0.43M. It may therefore still be experiencing problems, and selling TEL shares if it has any left? Is it though likely that any placee from the recent placing at 2.5p is selling immediately at a loss? In addition, the recent acquisition and placing announcements haven't said that Hoodless Brennan was involved. Whereas the previous (14-Feb-05) acquisition and placing announcement was more explicit: "In parallel with the acquisition the Company announces that it is placing 18,000,000 new ordinary shares of 2.5p each in the capital of the Company at 2.5p per share to raise £450,000 through HB-capital." The 28-Oct-05 announcement actually said: "The cash consideration for the acquisition of Westcom has been raised by the placing of 20 million Ordinary Shares with institutions and private investors." B.F.
03/3/2005
20:37
blank frank: Thanks to SteMis for the new Hardman note info. And thanks to jonwig for the Mosaique overhang theory. TELEPHONE MAINTENANCE GROUP PLC AIM ADMISSION PROSPECTUS DATED 24 SEPTEMBER 2004 PART V ADDITIONAL INFORMATION "10. Material Contracts [EXTRACTS] 10.2 a loan agreement dated 21 September 2004 between (1) Mosaique Plc (''Mosaique'') and (2) the Company whereby Mosaique made an unsecured interest free loan of £250,000 to the Company which, subject to Admission taking place no later than 31 October 2004, will be converted by the Company into Ordinary Shares as part of the Placing at the Placing Price. In the event that Mosaique procures placees for the purpose of the Placing in excess of £150,000 the difference between this amount and £150,000 shall become repayable by the Company to Mosaique; 10.5 ... The Directors have undertaken that they will not dispose of any Ordinary Shares (save in certain limited circumstances) for at least one year from the date of Admission and for a further 12 months, to deal on an orderly market basis through CFA or the Company's broker from time to time. 10.7 on 24 September 2004, the Company granted a warrant in favour of Mosaique Plc, a consultant to the Company. Such warrant is conditional upon Admission, and is in respect of 4 per cent. of the Enlarged Share Capital and is exercisable at the Placing Price. The warrant may be exercised in whole or in part at any time up until 28 September 2009. The warrant contains an undertaking by Mosaique Plc not to dispose of any Ordinary Shares from such exercise for a period of one year from Admission and, for a further twelve months, to deal through CFA or the Company's broker from time to time. 10.13 Pursuant to lock-in undertakings dated 24 September 2004 the Shareholders listed below have undertaken to the Company and CFA not to dispose of any interest in any Ordinary Shares for a period of one year from the date of Admission, save in certain limited circumstances. For a further period of 12 months the relevant Shareholders will only dispose of any Ordinary Shares through the Company's broker on an orderly market basis. Name Shareholding prior to Admission Ian Leask 18.9% Mediterranean Trust Corporation 9.1% Boston Investment Management Group Limited 9.1%" From the prospectus, none of TEL's AIM placing shares appear to be subject to a lock-in agreement (and I believe that it would be unusual if they were). Last 3 TEL trades: Time/Date Price Volume Trade value Type 16:26:27 03-Mar-2005 2.63 100,000 2,625.00 Single protected transaction 08:57:27 03-Mar-2005 3.50 66,000 2,310.00 Broker to Broker 16:27:13 02-Mar-2005 2.63 188,125 4,938.28 Ordinary Trade Today TEL has fallen half a penny, to 2.625p. For some time now - since latter 2004 - there seems to have been unusually large TEL sales volume. This took me by surprise - I couldn't really work out where all those shares were coming from. There seemed to be too many to be accounted for by post-IPO purchasers selling, but the main pre-IPO shareholders were locked in. That mainly just left the IPO placees themselves - but why subscribe at 3.5p, and then sell shortly afterwards, sometimes at a sizeable loss, when TEL is doing well? 'Distress' selling by Mosaique could well explain things. The timing also looks right - Mosaique only seems to have reported its difficulties in mid December, which is when the TEL share price really began to be hit hard. One consolation is that we know that TEL is doing fine, so its falling share price is no reflection upon its fundamentals. And an overhang is very much a double-edged sword: when one ends, the share price can suddenly rise rapidly. A recent example is AIM-listed Gaming Corporation: OFEX-listed Eyeconomy dumped its GMC at about 3p (4th. February Eeyconomy announcement) - and GMC has since quintupled to over 15p in about a month. http://www.advfn.com/cmn/fbb/thread.php3?id=8285022 An overhang may well mean that TEL is now at an artificially low price. So how will things pan out re. any overhang, and TEL's share price? It's difficult to speculate how on how many TEL shares Mosaique may have sold (ASSUMING IT'S THEM SELLING, as we don't have explicit evidence). In theory it should be announced if sales take ownership through a full percentage above 3%, though this doesn't always happen (immediately). That aside, I would think that it could be up to a few million shares, so they don't necessarily have many left. TEL directors cannot buy at the moment because we are in a close period; maybe they will after the coming interims. And/or maybe a tipsheet will be attracted by TEL's low price and good news, and give it a boost. So all in all, it could be that this is a terrific buying opportunity. I would be interested in hearing the views of others on this. B.F.
04/10/2004
20:18
blank frank: http://www.londonstockexchange.com/en-gb/pricesnews/prices/system/detailedprices.htm?sym=GB00B01YXX49GBGBXAIM%20B01YXX4TEL http://www.tmgtelecom.co.uk/ Link to TEL AIM IPO prospectus extract, and research note: http://www.advfn.com/cmn/fbb/thread.php3?id=8335608 WHY I THINK THIS TELECOMS TIDDLER IS TOP TRUMPS; LET ME TELL YOU ABOUT TEL (this update 8th. February 2005):- TEL: Business Model & Opportunity :- The common angle between TEL and Mears is obviously maintenance: http://www.mearsgroup.co.uk/mears_group/home/homepage.shtml http://www.hoovers.com/mears-group/--ID__120359--/free-co-factsheet.xhtml "Mears Group is one of the largest repair and maintenance providers for social housing in the UK. About 65% of its revenues come from maintenance services to social housing and government sectors." Compare to TEL (part I, section 5, AIM IPO prospectus (link to extract above)): "Support services encompass maintenance, hardware upgrades and infrastructure alterations and represented 48 per cent. of the Group's turnover in the year ended 31 July 2003." Maintenance is a great area to be in because it provides such secure revenues - it's fairly essential expenditure for the recipient, and is renewable, i.e. the recipient requires it on an ongoing basis. But telephone maintenance is a particularly good area to be in. Businesses are required to have a telephone maintenance contract by law, so you can't get much more non-discretionary than that. But modern telephone systems are so reliable that they rarely break down, which means that in many cases the maintenance contract brings in money for doing nothing. In effect it's a form of insurance, which is often not called upon. My understanding is that TEL bills its maintenance contracts in advance for the coming year, which is great for cashflow, and that the maintenance contracts are renewed fairly automatically. Of course, TEL's maintenance contractees will often want other telecom services during the year, and TEL is in a great position to get that business once it's got its foot in the door with the maintenance contract. It's much simpler for a business to meet their telecom needs from one main source. To date TEL has grown largely organically, but TEL has opportunities to acquire maintenance contracts en masse (or even complete telecom businesses - the market is highly fragmented) relatively cheaply, and when it does this the 'cross-selling' opportunities will be terrific, as will the opportunities for cost savings. And if TEL is rated more highly than what it is acquiring, acquisitions of anything profitable will be immediately earnings enhancing. On top of this, organic growth should continue apace, and the larger TEL gets the better position it will be in to land bigger and more profitable contracts. TEL's Travis Perkins maintenance contract should be a sign of things to come; TP operate a chain of over 700 builders' merchants, and is currently taking over Wickes which operates over 170 stores; the TP market cap. is over £2Bn. Previously, TP had a range of telephone maintainers, and switching to TEL has enabled them to save substantial amounts of money on this, and to have the convenience of working with just the one company. Because TEL operates nationally it has the capability to do this, whereas most competitors would not. For really big players like BT though the maintenance market is not regarded as a core business area. In fact, TEL has picked up many excellent staff from BT. Mears has obviously been a terrific investment, rising about 25-fold over the last five and a quarter years from c. 10p to over 260p, with great support from institutions and tipsters. Turnover and profits have improved dramatically, through a combination of organic growth and very earnings-enhancing acquisitions. But a rerating upwards to a P/E in the 30s has also helped. [EPS 4.02p, half year end 30/6/04.] I am hugely excited by the potential of TEL to grow with a similar business expansion model to Mears, and I believe that it has a great chance of fulfilling its strategy: "Through continuous expansion throughout the UK, the Group aims to become the telephone maintenance company of choice for corporate clients." If it does so, then a similar share price performance to that of Mears is very possible. TEL: Service, Value, and Sales:- ∙ A friend of mine has invested in TEL (like myself), and spoken to them (like myself). One of the directors apparently told him that they had an excellent reputation for service delivery. The facts bear this out: the AIM IPO prospectus (link to extract above) names Palmer Harvey McLane as an existing major corporate client where TEL is the preferred telephone maintenance provider. PHM clearly must be happy with the service (and price) to have since given TEL a £1 million contract for the supply of telephone call and line management services (5/11/04 announcement). ∙ TEL aim to provide telecom maintenance services more cheaply than competitors. This is something that is touched upon in the prospectus: "The Directors identified that larger, multi national companies might prefer to deal with smaller telephone support companies which could provide a more efficient service on better terms than those provided by other large providers." It came out more clearly in speaking to the company. I believe that Travis Perkins saved tens of thousands of pounds a year on their telephone maintenance by switching to TEL. ∙ From the prospectus: "Ian Leask, aged 60, director of sales Ian joined Jeff Williams in 1997 at the inception of the Group and has been instrumental in ensuring the success of the business. He was a director of Richmond Truck Rental Limited and has been involved in the growth of a number of business ventures in music retailing and financial broking. His general selling experience both in controlling a direct sales organisation and in devising and implementing sales and marketing policies have enabled the Group to enjoy a good rate of expansion." Apparently Ian is provided with a fulsome diary of ongoing sales appointments. TEL have grown organically from scratch in 1997 to annualised turnover of about £4M. today - you don't do that by not having good marketing/sales personnel. "We supply our customers with new telephone systems and provide maintenance and service cover throughout the UK. We provide a truly national service with clients from Inverness to Southampton and Haverfordwest to Ipswich." http://www.tmgtelecom.co.uk/index2.html TEL: Staff & Customer Retention:- ∙ TEL appears to be outstanding at staff retention. MD Jeff Williams seems to strive for a 'family atmosphere' (indeed I've previously read on TEL's website about a TEL social event for all staff). I was told that they have suffered hardly any staff losses in their history; e.g. one telephone engineer who was apparently not that good, and a personal assistant who needed to move because of family ill health. TEL appear to be a good employer to work for, and seem to really appreciate their staff - Jeff Williams gave me a hint of pride in the fact that he has good quality employees. This is clearly the proper way to treat people - with the respect they deserve. But it's also VERY important for business, because I would rate good employee relations (and motivation) as one of the most important requirements for a business to succeed (the other being to have the correct business strategy). Studies have shown that there can be a VAST difference between the productivity of contented v. discontented employees, and good treatment of people is clearly fundamental to their happiness. ∙ It's a similar story with TEL's customer contracts. I was informed that they have never lost a major client: that speaks volumes for their quality of service and value for money. Only some tiny little contract losses - and remember that a maintenance contract for a small business can be quite tiny. But TEL is now targeting bigger contracts in any case, where revenues are more likely to cover any maintenance work required. A large customer like Travis Perkins didn't change its maintenance contracts to TEL that easily: they had a range of existing telephone maintainers (some were inherited from acquisitions), and the transfer process was not that simple. Once they've changed, it seems to me that they're likely to stay put as long as TEL don't screw up - and TEL don't screw up. In any case, most competitiors would not have the necessary national coverage and resources, even if they could compete with TEL on price and quality. TEL: Heavy Hitters on Board:- ∙ From the prospectus: "3. Key strengths In the view of the Directors the Company has the following key strengths: ... * the Group has an experienced management team and engineering workforce; and * the Company has experienced PLC directors." ∙ James Williams, aged 71, non-executive director. Was part of the group (main board director) that built up fully-listed building products group Newman Tonks, where he was chairman of its overseas division for over 15 years and was involved with a number of UK and US acquisitions. (Newman Tonks was taken over by Ingersoll-Rand in 1997, for US$378M. http://en.normbau.de/index.php?wo=unternehmen&PHPSESSID=f2ba4fae907850a5b16e54aee4348f4f ) ∙ Jeffrey Williams, aged 48, Managing Director. Co-founder of TMG, with previous director experience. The son of James Williams, so business drive and ability seems to be 'in the blood'. He also has a degree in business. ∙ Lord Razzall, aged 61, non-executive Chairman. Oxford graduate, CBE, Life Peer, National Treasurer of the Liberal Democrats for 11 years, and the Liberal Democrat spokesman on Trade and Industry in the House of Lords (at date of prospectus). A former Chief Executive, with over 25 years experience in corporate finance advice. In 1995 he joined Argonaut Associates whose focus is corporate financial advice particularly to medium sized businesses. ∙ Sandy Saunders, aged 69, Deputy Chairman and Director of Finance. From the mid 1970s to 1990 he was Chairman of some fifteen quoted industrial holding companies, during which time he was also a Council Member of the CBI, and industrial adviser to several international banks. In July 1995, in partnership with 3i Group plc he led a management buy-in team into the telecommunications sector. The team acquired control of the UK's largest Panasonic and GPT/Siemens dealer, and developed new marketing strategies and broadened the product range. In May 1997 he initiated the merger which created Wellcomm, and became Chairman of the enlarged group before it was acquired by Canon in 1999. He was then approached to become Chairman of Touchbase Communications, a leading supplier of telephone systems to financial institutions internationally. He is now Chairman of several privately owned companies providing financial services to industry (at date of prospectus). ∙ John Mitchell, aged 57, non-executive director. Oxford graduate. Chief executive of Lloyds International, Australia between 1980 and 1985 and then a director of Lloyds Merchant Bank, London until 1988. In 1988 he became an executive director of National Mutual Royal Bank before joining Turnbull & Partners in 1990 where he worked in international corporate finance. In 1994 he established Argonaut Associates. He has served on a number of public company boards. [Ages correct at date of TEL IPO prospectus - 24/9/04.] The TEL board as a whole contains the sort of 'heavy hitters' that one would associate with a far larger company (TEL. market capitalisation below £3M.). TEL: Acquisition Plans:- TEL have a separate group financial controller in addition to the FD; extract from Senior Management section of prospectus: "Greg Hallett FCCA, aged 42, group financial controller After qualifying as a certified accountant, Greg gained extensive experience in a variety of industry fields including manufacturing, brand sales and distribution, consultancy and financial services. He has spent most of his career within the SME marketplace including acting as a non executive director for a computer software company. Greg joined TMG in February 2003 with the specific remit of facilitating the further expansion of the business through fund raising, acquisitions and internal financial control." I believe that Greg takes on much of the FD type of work. I have spoken to him, and he seems excellent: very enthusiastic and committed to TEL (I believe that he has personally invested in the company), with a good grasp of the issues and a fine attention to detail. It was with Greg that I last discussed TEL's acquisition plans. They have apparently been monitoring potential acquisition(s) since at least 2003, but want to be sure that they're not acquiring a liability, and don't want to overpay. Any acquisition has to be the right one at the right price, and I'm sure they are being cautious. Acquisitions always have the potential to be difficult, but they're especially dangerous if quite a few are made close together, and/or they're abroad. If the acquirer is also over-expanding organically that too can complicate things. TEL however have had a period of relative consolidation for the last few years: 31 July 31 July 31 July 2002 2003 2004 £'000 £'000 £'000 Turnover 2,790 3,267 3,731 This is compared to the explosive initial growth from the 1997 start to 2001. During this latter period staff numbers have been relatively static at around the 40 level, or near there, and with little change in personnel. In addition, TEL operate from just one main base in Bromsgrove. All this being the case, I'm happy that things are 'bedded down' enough to handle an acquisition or two relatively easily. Acquisitions have the potential to accelerate TEL's growth significantly, and should be strongly earnings enhancing. The directors of TEL seem very confident of achieving significant growth over the next few years. The losses to date I believe reflect the investment that TEL has made into its infrastructure. At 2.875p (8th. February 2005) I rate TEL as a STRONG BUY. [Previous B.F. recommendation 04 Oct'04 - 21:18: "At 3.5p I rate TEL as a STRONG BUY."] B.F.
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