Avanti Capital Share Discussion Threads

[adam] 20/7/2005 14:25

jeffian. It's not looking good.
Interesting though that LMR not keen enough to sell at any price and have "ring fenced" the assets with own management team. Should imagine then some sort of corporate action at some point, and I still maintain that Barvest will participate in a "bulking up" exercise. At what price though is debatable.
Things can always get worse though...

[jeffian] 20/7/2005 10:41

This from citywire today:
"* Luminar fails to find a buyer for its entertainment arm."
Wonder how AVA's getting on with Po Na Na?

Regards, Ian

[lbo] 07/7/2005 16:35

A very sad day in my opinion and hard to to think about the markets today


However this will have detrimental effects on the sector and may put an end to consolidation in the sector for the moment.

[lbo] 02/7/2005 18:13

Perhaps no deal just yet! ;)

[jeffian] 01/7/2005 23:50

Errrrmmmm........if this is all positive news, what is the graph in the header post telling us?

Regards, Ian

[lbo] 01/7/2005 20:34

A bit about TDR capital on the CMIP thread



The FT

SFI agrees to £80m sale of 98 outlets to Laurel
By Carlos Grande

SFI, the heavily indebted owner of the Slug and Lettuce and other high street bars, yesterday went into administration and agreed to sell 98 of its 150 outlets to Laurel, the pub company controlled by Robert Tchenguiz, the property investor, for £80m.

Administrators at PwC said the unsold 52 SFI outlets employing about 780 employees would trade while a buyer was sought and a

site-by-site review undertaken.

The SFI estate is all leasehold and includes such brands as Havana, the Litten Tree and Bar Med. SFI tried and failed to sell Bar Med.

SFI has been, in effect, controlled by its banks since 2004 when, in return for halving the group's debt from £160m to £80m, a syndicate of lending banks took a 75 per cent equity stake.

Following the sale of two-thirds of its outlets to Laurel, about 90 to 95 per cent of the current bank debt is expected to be recovered, though the original bank syndicate is believed to have long sold on its debt.

The move into administration opens the final chapter in the SFI saga. SFI shares, which reached 300p in 2001, were suspended at 31p in 2002 after accounting problems, including a £20m gap between assets and liabilities, were discovered. The company later delisted voluntarily.

In January, SFI appointed Kroll Corporate Finance to carry out a strategic review and received several approaches. In its most recent trading update, it reported positive like-for-like sales, in spite of what is generally thought to be a tough high street trading environment.The spate of acquisitions made by Laurel, which
is owned by R20 - the investment vehicle of Mr Tchenguiz, which also bought Yates - is seen as one response to these conditions.

He now owns about 400 high street outlets.

Separately, it emerged yesterday that Mr Tchenguiz is paying £80m for the Heritage Pub Company, a privately owned estate of tenanted community pubs, run by entrepreneurs John Finney, David Harrison and John O'Neill.

[arthur_lame_stocks] 01/7/2005 16:51

mBlox news of sorts.

[lbo] 01/7/2005 12:51

Well they are people of their word! ;)

The Company, pursuant to the authority obtained at the Annual General Meeting on
11 November 2004, has purchased for cancellation 407,000 ordinary shares in the
capital of the Company at 150p per share.

[adam] 29/6/2005 18:58

Well I think a transaction for Barvest is still likely. Essentially that larger transactions happen first, and that Barvest would be a bolt on. He wouldn't be drawn further on it, but that was my clear understaning. Prior to speaking to them I had put my stake up for sale, but had no bites. So asked if you are that positive why cannot I find buyers for the stock (295k). Almost bit my arm off for the stock and said was not made aware that I was a seller and should have called the company and would have it placed. My interpretation then just lazy brokers not bothering to call the client. I have withdrawn my offer. In any event I shall review come results in September and see whether they can deliver, and yes I think Barvest should be the litmus test.
Medcentre I still remain to be convinced on, but said invested because of management and seemed confident of exit in relatively short space of time. We shall see. I said easy to put money in, not so easy to get money out. He agreed.

[jeffian] 29/6/2005 17:24

OK. What's their slant on it?

[adam] 29/6/2005 16:40

Ian,
Having spoken to the company now I am retracting previous comments, as I may have been hasty.

[jeffian] 29/6/2005 15:55

adam,

I agree with your realistic interpretation entirely. That's not exactly a bullish statement about Po Na Na, is it, nearly 3.5 months after they announced it was up for sale? Still, you know my views. Don't be surprised if the next statement is something along the lines of 'pulling the sale as Board considers it worth more than offers received' or some such.

Regards, Ian

[adam] 29/6/2005 14:06

LBO - A less reverant view.....

flannel words "this has had some impact"...."The company continues to believe that Po Na Na will be part of the sector consolidation
"

In other words they are having problems shifting it at a decent price given all the other (better) stuff on the market. No doubt it will go, but they will have to swallow their pride a bit. Meanwhile the trading environment ain't great. It is notable that the share price dropped in the days prior to this RNS

mblox
OK, but wooly words and doesn't spill the beans really on anything. Maybe AVA will have to pony up more cash if mBlox becomes acquisitive.

Medcenter
A titular amount, and to me shows a) lack of conviction b) unable to exit portfolio investments but continuing to invest cash pile c) What does this mean "to improve communications between the pharmaceutical industry and the prescribing and dispensing community " ?

In short what a load of guff.

New Investments
"currently is in discussions with a number of companies with a view to making new investments "

I have my eyes shut :-(

[lbo] 29/6/2005 12:49

Looks like your comments on mblox were also right

"mBlox is a leading European and US provider of SMS services. During the first
quarter of 2005, mBlox has achieved strong growth in its principal markets,
recording revenue growth in line with its ambitious internal budgets.

The demand for SMS delivery and billing services continues to grow and as a
leader in this sector mBlox is in a very strong position.

The Company believes that there will be corporate activity in this sector and is
fully supportive of mBlox in pursuing its strategic goal of establishing itself
as the market leader"

[lbo] 29/6/2005 12:37

"The Company is advancing discussions with a number of parties regarding the
sale. Shareholders will have noted that a number of larger estates in the sector
have, more recently, been marketed for sale and this has had some impact on our
sale process. The Company continues to believe that Po Na Na will be part of the
sector consolidation currently being played out"

[adam] 26/6/2005 09:32

Re: Spirit


"The West End is one of the country's biggest markets, he added, and Urbium will be "looking to do more acquisitions in the area", after the company, which operates the Tiger Tiger chain, announced it had acquired the Long Island Iced Tea Room and Bar 38 outlets from the Spirit Group.


....Mr Richards believes a number of sites will come onto the market in the coming months and Urbium will be ready to buy. "These outlets are non-core to their current owners and we will be in the market for them," he said. "

Also, from the same website

[lbo] 15/6/2005 19:43

There is some activity in the sector
last weeks guardian




"Aim-listed night club operator Urbium jumped 65 to 700p after receiving and rejecting an unsolicited indicative proposal from Regents Inns, down 3½ to 77½p. After the market closed, Regent Inns said it had proposed 820p-a-share paper offer, with a partial cash option, and was considering its position

[adam] 14/6/2005 13:52

jeffian. Thanks. I don't disagree with your analysis, I think I implied would be less than that. By your own analysis though they might be worth something more than the £600k though. Aside which a purchaser may wish to manage differently and/or rebrand - geven that David Phelps left under a cloud. The £15m is to buy out debt too, so to be fair you have to say a £15m purchase would value the bars at £10m and the debt at par, remembering that AVA own near half the debt. At £10m for the bars debt free then would imply £350k per bar which would not be unrealistic. I think operators would want to bulk up because of central costs and the start up costs to new bars never mind good placing/sites would be significant. It is I do not disagree a thorny asset, but my point is, to repeat myself, in the books at next to nothing.
What do you think of mBlox?

[jeffian] 14/6/2005 10:22

Adam,

Surely a better comparison than Inventive (vodka bars) is yesterday's announcement by Luminar of the sale of their Enterprise Division (nightclubs) to management? They have sold 49 clubs for £27.2m (£555k each), with each club turning over around £930k and producing £116k EBITDA and £61k profit before central admin costs. Extrapolating from the interims, Barvest's outlets currently seem to be turning over around £714k producing £42k EBITDA and losses at the bottom line, so why would someone pay £15m (£535k per unit) - which is equivalent to the value of the Luminar units - for significantly less performance? Also, if they were worth £6m/££214k per unit when acquired in August 2003 when they made £2m EBITDA in the preceding 45 weeks, why would they be worth more than double that now that EBITDA has halved?

Regards, Ian

[growbag] 13/6/2005 16:51

Adam - If you are right, then we could be looking at a significant hike in Avanti's NAV. A re-rating would have to be on the cards.

[adam] 13/6/2005 14:47

Inventive is interesting in view of their comments in the results and the valuation. I think they are "Vodka" bars, but still...


turnover £22m (6 months) - twice Barvest
PBT £1.8m (Barvest borderline / loss making)
Net debt £9.3m, Barvest (£4.5m - £2m owned by Avanti)
NAV £18m, Barvest £1m
Bars: Inventive = 43, barvest = 28
m/cap £23m
EV= £33m

I would not put Barvest at even half the value as has no tangible assets and not making much money if any.

So maybe Barvest EV = £15m, which leaves equity at £10m. Equity booked at £600k (75%). Seems improbable not worth more even if not worth £15m.

Inventive say
"We are actively seeking new sites, which are likely to be existing licensed premises in our target towns and cities. We are currently in negotiations on five locations and will provide further updates in due course.
"

Also the following may be of interest

[lbo] 13/6/2005 10:01

Panmure Gordon, in a note on the UK licensed retail sector, has buy ratings for Punch Taverns with a 775p price target, Wolverhampton & Dudley with a £12 price target and Inventive Leisure with a 125p price target.

[lbo] 03/6/2005 07:58

Good find Adam!

looks promising for Avanti Capitals investment in Barvest

Here is a link to to the article


He is the former CEO of the Laurel pub group and seems he is being backed by the the TDR guys who bought Pizza Express. I also hear John sands former boss of pubmaster is bidding for the 170 bars put up for sale by Spirit along with TDR also. Also Barracuda is cpming up for sale and the late night bar business of luminar is also.