Assetco Share Discussion Threads

[woozle1] 26/6/2019 19:00

What's the biggest I can get away with ?
w1

[rjmahan] 26/6/2019 18:23

Woozle you are trying to buy too much - smaller clips and you will get filled....

[konradpuss] 26/6/2019 18:15

Woozie1, do you have a broker that can call the market maker? They can be bought by appointment. This is how I have managed to buy a few.

[woozle1] 26/6/2019 17:44

someone probably paid up to get shares. I've had a daily bid for 10k shares at 300p and yet to get hit.
w1

[zcaprd7] 26/6/2019 17:39

Any reason for the rise today?

[konradpuss] 20/6/2019 11:14

flyfisher, I guess they have tax losses to cover although I wonder if these were wiped out through the scheme of arrangement.

I will look at their accounts.

[flyfisher] 20/6/2019 10:52

What is the tax liability on the award?

[vnvd] 06/6/2019 16:57

In regard to the transfer of emplyees, for anyboy also interested:

"With effect from this week [the announcement was released on December] the Company has transferred the Emirati employees, who carried out the day to day operations..."

[vnvd] 06/6/2019 16:53

Thank you for sharing your analysis, rjmahan, its clear you have researched this company thoroughly.
I agree that any impairment of AR is unlikely given who the customer and payor is. My liquidation cost is probably in the high range, but I prefer to err on the safe side - sometimes its management severance payments, sometimes something else, but past experience has taught me to prepare for unpleasant "surprises".

I didnt know about most employees having been transferred. I havent found that information in the AR, I will try in the press releases. This a point I really would like to clarify, as I understand that the company is not going to keep its employees just sitting in the office, but I also understood from the AR that the company was searching for new customers, therefore part of the personnel must still be with the company, otherwise, how could it execute any new contract?

Somebody just mentioned the possibility of the company just buying some other business at a price that would bring immediate value to shareholders in an order of several multiples (ex an immediate x3 in value). I wonder what you think about that. The way I see it, if management knew about a business they could buy at a fraction of its value, they wouldnt wait for anything, they would just go for it (its some of the current owners line of business, at the end).

Anyway, thanks everybody for all the great insights.

[konradpuss] 05/6/2019 20:51

rjmahan, I an sure somewhere there will be the judgement in respect of the right to appeal to the Court of Appeal. This will set out the points that they (the Court of Appeal) will look at over again as leave to appeal was only allowed on certain issues.

I rate the Judge very highly who handed down the original judgement.

I did have a read of a few overviews of the appeal decision and have got through reading 10% of the decision myself.

The law is a funny thing, sometimes you just never get justice although I hope in this case Grant Thornton swing (although it will be mostly an insurance company paying I guess).

[rjmahan] 05/6/2019 20:35

On impairment - nothing impaired 2016/17/18. Expect same for 2019.

[rjmahan] 05/6/2019 20:32

We disagree on this.
I dont put in 2m of AR never received - I think this is unlikely.
I dont have a 4m liquidation cost - to me this seems much too high for what this is. Remember most staff have transferred.

You also miss interest on judgement and costs accruing
I get value of judgement at £33.4

£4.993m liabilities

My figures £34.963 Assets
+£22.4 Judgement Won
+£6 Interest Won
+£5 Costs Won
+1.3-2.6 Interest while waiting 6m-1yr appeal
-2 wind up costs
=£62.7m or £5.13 or 74% upside

If you say £6 wind-up costs you get to c£4.90 and 63% upside
Judgement is halved - you get to c£3.90 and 30% upside
Judgement is cancelled - likely £2 a share and 35% loss.

I had a look through court of appeals judgements and roughly in 2/3rds of cases original judgment is upheld. In c 1/3rd amendments are usually legal/administrative they don't often overturn entirely.

I read the whole judgement - it wasn't a fun few days.

I don't think the judge is flying a kite - though I could be wrong. We don't agree on figures but even on yours if you say its 66/33 probabilities gives 13% expected upside.

Ambiguity around current business isn't great but its been like that for a while and has always done OK - but is coming to an end. These shareholders aren't giving anyone a job out of the goodness of their hearts.

[woozle1] 05/6/2019 20:14

I agree that the downside is 30-40% but the cash will likely be used to buy something that is more valuable than the cash and the upside is multiples from here. This has been a real dog for Mills and buying something at a decent price or reversing a private company into what will likely become a cash shell is a good outcome. Down 30-40% or up multiples that looks like decent odds to me.
w1

[vnvd] 05/6/2019 19:43

I have been doing some DD, and cant find a compelling investment thesis here - not at a ca 40M market cap. Let me share my figures.
the good) LV = + 16M in AR - 2M of AR never received + 17M in cash - 5M of liabilities + 32M Grant Thornton - 4M liquidation cost = 54M
the bad) LV = + 16M in AR - 2M of AR never received + 17M in cash - 5M of liabilities + 0M Grant Thornton - 4M liquidation cost = 22M
This is a ~30% upside vs a 40% downside. While "the bad" scenario may be much less probable (something I personally cannot judge), the potential reward does not seem that compelling - maybe my Grant Thornthon 32M amount is too small? The amount of AR impaired, or the liquidation cost, can be changed as per ones judgment, but they probably wont change the overall picture that much.
Further, the future of the business is shrouded in total mistery. In the last AR, the company said it is keeping the personnel while it tries to find a new customer. While the search lasts, we have expenses but no revenues, and even if we do find a new customer, profits are not guaranteed (as the company itself clearly tells us in the AR).
While the possibility also exists that the company could do something stupid with the money from Grant Thornton, given the shareholders of the company I consider that highly unlikely.

[rjmahan] 05/6/2019 19:27

Anyone / have the judgement on leave to appeal ? I have looked but can't find it.

Thanks,
Rob

[konradpuss] 31/5/2019 07:52

I have been to the Court of Appeal twice and once to the 'steps' of the Supreme Court. These were 'property' cases not company commercial In actual fact the Court of Appeal usually costs much more than the Supreme Court.

The Supreme Court will probably not even be a whole day.

I intend on reading line by line the decision over the weekend.

There will be on line somewhere the judgement to allow leave to appeal to the Court of Appeal. This was not given by the lower court, it was given by the Court of Appeal. This will give some idea of what they will be looking as it is only some aspects of the judgement that are being looked at again.

The 'mood music' will not help Grant Thornton in my humble.

[value hound] 31/5/2019 07:43

Yes indeed. It sets a dangerous precedent for them, though, so this was inevitable.

[spectoacc] 31/5/2019 07:36

Guess GT have little choice, with the money involved - but I hope they lose, with huge costs.

[konradpuss] 31/5/2019 07:31

The RNS says that Grant Thornton have received leave to appeal to the Court of Appeal on certain aspects of the judgement

With the complexity of the judgement I an not really surprised.

My guess - appeal date back end of the year - decision early next year.

If Grant Thornton lose, the underwriters will almost certainly then get the lawyers to try for an appeal to the Supreme Court. They might just get there. This will run and run.

[ntv] 25/2/2019 19:15

GT have CAKE litigation to look forward too as well
My guess is that will be a lot bigger
bought and sold a bit quickly here mainly because I thought they would be able to appeal

[topvest] 25/2/2019 18:42

This is a big number per GT partner. £60k each by my maths. It’s *3 their provisions for negligence claims.

[woozle1] 25/2/2019 16:37

That AssetCo still have a PR agency and corporate broker could mean that this story is not over and more to come; in terms of corporate activity. Mills does not pay for anything he does not need.
w1

[woozle1] 25/2/2019 16:34

Will the auditor's insurance payout or GT itself?
w1

[eezymunny] 25/2/2019 16:17

Award + existing cash +net(receivables-payables) comes to c. 480p/share by my sums.