Allied Minds Share Discussion Threads

[spectoacc] 04/6/2020 06:32

Not read it all, but this line struck me:

"...And delivered substantial value for shareholders."

Really? Have you?

[paulisi] 04/6/2020 06:18

Yes - accounts are out.

[bobonumber1] 03/6/2020 14:07

Are results going to be tomorrow? Again nada from the board.

[catscats] 22/5/2020 09:25

We will know the new NAV soon but now looks to be on about 50% discount. i would suggest that is too high as the investee companies are now seeing better newsflow. Hopefully further good news can push this to a more normal 25% discount. i like the fact that the company has cash, exciting tech interests and is US based where valuations for such companies are generally higher.

[flyfisher] 22/5/2020 08:41

The dividend was 12.62p.

[bobonumber1] 18/5/2020 16:21

22p I think

[spectoacc] 18/5/2020 15:36

Add back the 17p (or was it 19p?) cash return, & ALM not having a bad crisis. As it perhaps shouldn't, when there's cash & tech backing.

[walterwhite1] 17/5/2020 19:39

Spin memory is given credit with its logo included in the presentation.
Great find :-)

[bobonumber1] 17/5/2020 19:10

This is about 6 months old but in the absence of news from spin looks quite compelling. Would people deduce that Arms Emram deal with Samsung is with spins tech ? http://www.armtechforum.com.cn/attached/article/C-1_ZhaoweiTeng20191126134420.pdf

[flyfisher] 11/5/2020 17:30

A firm market since jefferies updated their coverage a couple of weeks ago, little broker coverage otherwise.

[pete_bane] 11/5/2020 09:18

Yes, specto, you could boss people about and be your officious self. You could even wear those fake medals on your tunic. "For valour in the face of the Stasi enemy"!

[chuckol] 11/5/2020 07:49

I think you may be whistling in the dark, Specto. I sympathise with you because you've already taken a huge hit here(and in another dozen or so similar shares). I mean wouldn't it be better if you confronted the sad fact that a drop of over 40% odd is a massive blow to your portfolio, such as it is now.

I think, for the time being at least, you should take that temp job as a Queue Marshall at Morrisons.

[wnd78] 11/5/2020 07:40

You have to hope Federated will sell for more than last round. Spin Memory could be the multi bagger as great product and last investment was in 2018 and largely quiet without fund raise could be a good sign. Bridgesat not sure.

[spectoacc] 10/5/2020 19:32

Thanks @wnd78 - I fancy at least one of Federated or Spin to go for better money, tho also have to burn some of that cash down over time, & timescales important.

Agree on tiny stuff being largely worthless too.

ALM done well not to be holding largely Covid-unaffected stuff.

[wnd78] 10/5/2020 10:09

ALM Federated Wireless stake post money = $88m
Current issues share capital of ALM = 241,568,306
Value per share = 36.4c
Value per share GBX = 29.3p (fluctuates with exchange rate obviously)

Regarding cash, I estimate that ALM currently holds around $45m which takes previously disclosed cash, adds the amount they kept from the Hawkeye sale, subtracts the investments made since then (including Federated), subtracts a bit for head office burn.

This means current cash per share = 18.6c or 15p

So Federated stake + ALM Cash at hand = 44p

Then you have Bridgesat (8p / share valuation of ALM holding at last round) and Spin Memory (19p / share valuation of ALM holding at last round)

Then you have a few others that are tiny / early stage and probably worthless

Add this up and IF they can sell these businesses in future for at least the valuation of the last round, then you have around 70p / share.

That of course is the big IF....

[giggs2006] 10/5/2020 09:00

Sorry I did not read it through correctly my apologies

[giggs2006] 10/5/2020 08:56

Are these figures correct as Hawkeye was sold by allied minds for $65.6 million which equated to 22p per share For AM. So how does $260 million equate to 28-29p per share 🤷‍a92;️

[spectoacc] 09/5/2020 18:53

28p per share, but cash at company level dropped due to the investment of course.

[wnd78] 09/5/2020 14:12

Oops, those should have been $ signs not £!

Pre money valuation = $226.7m
Post money valuation = $240.4m
ALM stake post money = $88m
Per share = 28-29p (GBX)

[wnd78] 09/5/2020 13:16

Some very fundamental misunderstandings here of the difference in mechanics between investing in a company for new share issuances vs buying/selling existing shares.

Imagine the following scenario. I have a company with technology that is worth £100 (my enterprise value) and £10 in my company bank account. My company is therefore valued at £110. You decide to invest in my company, and you invest £55 in return for new shares (note, you didn’t BUY the shares from someone else, the company issued you new shares so the company receives your £55). Do you get 50% of the company? No, you don’t. Why? Because after your investment of £55, my company is now worth £165 (£100 enterprise value plus £65 cash in it’s account, or to put it another way a pre-money valuation of £110 and a post-money valuation of £165). You actually get new shares equal to £55/£165 = 33% of the company. If we sell it tomorrow for the same post money valuation, you get your investment back.

Now turning to Federated, we have all the numbers we need to work this out:

ALM previously diluted holding = 35.8%
ALM new diluted holding = 36.61%
Amount invested in total = 13.7m
ALM share of that amount = 50%

So, quick maths lesson:

Let N = pre-money valuation at this latest round

Then the new shares issued are worth 13.7 / (N + 13.7) as a percentage of the enlarged share capital of the company. Let’s call this V.

This means that ALMs new shareholding is:

35.8% * (1 - V) [dilution of existing shareholding] + V/2 [new shares] = 36.61%

Solving for V, we have V = (36.61% - 35.8%) / 14.2% = 5.7%

Then solving for N, we have N = 13.7m/5.7% - 13.7m = £226.7m

So the pre-money valuation was £226.7m (up about 13% on last rounds post-money), post money valuation is £240.4m (£226.7 + new money of £13.7m) and thus ALM’s stake is currently valued at £240.4 * 36.61% = £88m or 28p per share of ALM.

[bobonumber1] 03/5/2020 06:55

I was wrong. Somewhere the figures are not entirely right though

[bobonumber1] 29/4/2020 06:58

Maybe so. The valuation would still be around the Billion mark however

[flyfisher] 28/4/2020 21:39

bobo, A potential problem of your calculation is that it assumes no internal changes in share capital at federated wireless in the time between the september funding and the more recent funding.

There will likely be a range of directors options and warrants.

You will notice that the undiluted increase in holding of 0.54% is exceeded by the fully diluted 0.8% increase.

This suggests that someone has converted an option in the time period.

[alasdair100new] 28/4/2020 20:41

What should usually happen is that any exit (assuming we have a product that works) will be above any of the previous raises which gives further reassurance that our current share price is a bargain. If you look at our main 4 now you have to be hopeful of at least £2 a share all in if they come off. That's a serious upside. It could well be much more than that too depending on market conditions. If spin can ever get off the ground then that's a recurring revenue source. It could even produce a dividend

[bobonumber1] 28/4/2020 19:49

The seeds would be diluted and the new investors given their % based on the valuation.