Bagir Share Discussion Threads

[masurenguy] 05/6/2014 16:41

Hmm...price still falling I see. They raised £20m @56p at their IPO only 7 weeks ago by issuing 70% of their shares to new investors. This valued the business at £28m. Circa half of the £20m was used to pay off existing debt and credit factoring balances leaving them with a further £10m as working capital.

At todays price the market cap is circa £9m so virtually all of the funds raised have now been discounted. However they have now paid off all their debts and also have £10m in the bank. It looks like a perfectly timed IPO for the existing shareholders but more a case of 'Now you see it, now you don't' for all of the new investors !

[pimpi] 19/5/2014 16:13

a bunch of GANAVIM

[masurenguy] 16/5/2014 08:12

Suitmaker Bagir crashes after M&S slashes orders from firm

ONE OF the country's biggest listed menswear suppliers crashed nearly 70% in trading yesterday after its largest customer, Marks & Spencer, signalled a reduction in orders for the firm. Bagir Group, which floated last month, was forced to issue a profit warning due to the reduction in M&S orders, sending shares down 68%. Bagir, chaired by ex-Moss Bros chairman Keith Hamill, supplies suits to firms like Topman, Burton as well as M&S. M&S declined to comment.

N+1 Singer, Bagir's nominated adviser, said revenues would be $15m (£8.9m) lower this year, setting up a $2m loss and higher debts for the company. Boss Danny Taragan said it was a "major disappointment," adding that the firm "plans to take the necessary actions to help mitigate these issues". Bagir said it had obtained waivers on its bank debt. The company is listed on the alternative investment market.

[mach100] 16/5/2014 07:55

Absolutely disgusting! Not a holder or investor myself but they did come on my radar a few weeks ago. N+1 singer should carry a wealth warning! Time for an email methinks to let them know they won't be getting my business in future.

[masurenguy] 16/5/2014 01:35

M&S tailor undone in quite spectacular fashion one month after raising £20m

Stockbroking can be a tricky old business. Look at N+1 Singer, by general consent one of the more successful small-company brokers on the street these days. A month ago, it helped a tailor that supplies suits to the likes of Marks & Spencer, Arcadia, House of Fraser, TK Maxx and John Lewis to raise £20m by selling shares to investors at 56p in an AIM float. Hargreaves Hale, Artemis and Ignis all bought in while Fimi, the Israeli private equity firm, sold down from 40% to 17.4%.

Yesterday Bagir Group dropped a stunning profit warning and cautioned that it was in danger of breaching its banking covenants. Neither could there be any guarantee that its biggest customer, believed to be M&S, would retain it as a supplier. The shares promptly collapsed to 20½p, losing
nearly 68% of their value. A company valued at £28.1m a month ago was worth £10m last night.

[acta_topup] 15/5/2014 17:14

Whichever way you look at it - IT'S FRAUD. PURE AND SIMPLE. They need a forensic accountant and immediate suspension

[masurenguy] 15/5/2014 16:53

Salpara111 - 33: I simply dont belive that they did not know about the serious reduction in orders prior to the float.

Certainly hard to believe with the IPO taking place some 15 weeks after the end of Q4!

Suit maker Bagir crashes on profit warning
A major customer, probably Marks & Spencer, has reduced purchases.

The share price of suit maker for store labels Bagir Group Ltd. (AIM: BAGR) plunged, after the company published a profit warning today, just five weeks after its IPO.......At the time of the IPO, Bagir said that British retailer Marks & Spencer was its biggest customer......Bagir's share price fell 65.3% to £0.22. It held its IPO at £0.56 at a company value of £28.1m ($47m).

[stegrego] 15/5/2014 16:45

Giles Hargreaves has 15 percent of this.... He surely can't be happy.

[salpara111] 15/5/2014 16:39

I simply dont belive that they did not know about the serious reduction in orders prior to the float.....unless their financial controls are completely useless and if that is the case then they should have to answer to the FSA or at least their advisers should.

[buywell2] 15/5/2014 16:26

Yea

Like JLP

[masurenguy] 15/5/2014 16:16

gorilla36 "why on earth would you even think about AIM now."

I would never have invested here for the reasons already explained in post #24 above. However using this particular example to make a blanket condemnation of AIM is just utterly ridiculous. I have plenty of very profitable AIM listed investments.

[dr biotech] 15/5/2014 14:59

This is never going to recover. Clearly this parrot is dead, and was like that when it was sold. How could you ever trust the management again? The broker that brought this to market should have some liability. Presumably they have to do some sort of due diligence?

Sounds like the IPO was a rescue rights issue in disguise.

[masurenguy] 15/5/2014 14:32

Moral of the story : If you must AIM, then AIM carefully !

Quite right. Investing is all about research, fundamentals, buoyant and declining sectors, good business models, quality management, sufficient funding & some good/bad luck too. Generalisations, that either condone or condemn on purely an uninformed and undiscerning blanket basis are just a waste of time.

[stockonomist] 15/5/2014 13:59

The fact it was an Israeli float was the only red flag you needed.

Chinese, Israeli and US floats on AIM are always without exception going to have something dodgy about them.

They have their own capital markets why do they need to come and rip off UK mug punters on the lightly regulated AIM cesspit ?

Ahh yes the magic combination of light regulation and mug punters is what attracts them.

hxxp://www.moneyweek.com/investment-advice/penny-shares/penny-sleuth-why-i-dont-buy-chinese-stocks-on-aim-60618

Why I don't buy Chinese stocks on AIM

By Tom Bulford

Sep 18, 2012


Greg Rudd, the brother of the former Australian prime minister, once met a Chinese businessman who gave him some prudent advice.

"You tend to see the good in people, Mr Rudd", he started. "People like you. You laugh a lot. But you'll never make money in China with that attitude. You'll only be taken advantage of. People will trade off you. They won't pay you. The number one rule of doing business in China is this; never trust a Chinaman. Why would you as a foreigner trust a Chinese businessman when we as Chinese don't trust each other?"

Now that advice is pretty close to the bone. But I've said it before in Penny Sleuth – you have to be very careful when you invest in a Chinese company. The record of AIM-listed Chinese companies is simply awful. And with so many still coming to market, there is a real chance that many private investors will end up making some very expensive mistakes...

[acta_topup] 15/5/2014 13:57

I am talking about failure to disclose information - I don't believe for a second that what we have seen in the public domain was the full picture at the time of the floatation. I have no evidence of course but the timing speaks for itself

[masurenguy] 15/5/2014 13:52

It is not about 'positives' or 'negatives' which relate to generalities - it's about doing your own research into specific investment opportunities. Companies usually undertake an IPO for one of three reasons.
1. The private shareholders want to substantially or completely exit and cash up their investment.
2. The company wants to pay down or expunge debt.
3. The company is expanding and they need to raise funds to increase production and/or distribution.

I would only ever consider investing in an IPO for the third reason. People who had undertaken any research into the background of this company would easily have unearthed the following information.

"Bagir fell into a severe crisis several years ago, partly because of falling orders by British retailer Marks & Spencer. The company had a shareholders' equity deficit and heavy debts to banks and its controlling shareholders. Under president and CEO Daniel Taragan and chairman Samuel Vlodinger, the company turned around in the past 2 years, resumed growth and a positive cash flow from operations."

"Suits maker Bagir Group Ltd. raised $33 million at a company value of $66 million, after money, in its IPO on London's Alternative Investment Market (AIM) on Friday. Bagir, controlled by IshayDavidi's FIMI Opportunity Funds and Zvika Barinboim's SG Textile Ltd., issued 60% of its share capital. Following the IPO, FIMI's stake fell to 20% and SG Textile's stake fell to 15%."

[acta_topup] 15/5/2014 13:35

it is not foolish at all to highlight unacceptable behaviour like this which further tarnishes the reputation of a market that already has a pretty awful reputation

[acta_topup] 15/5/2014 13:34

unfortunately these negative scenarios trump the positives that you highlight - and indeed they SHOULD given that they demonstrate a fundamental systems failure which puts the profits of company directors and brokers BEFORE investors

[masurenguy] 15/5/2014 13:31

Acta_topup - 14: Yes - who is going to put money into new listings on AIM after this???

deanroberthunt - 18: all AIM is good for is a short term (day or so, or even hours) small value punt.... AIM is just a plethora of frauds, shareholder action groups, administration....and long road to the poor house

This kind of scenario will undoubtedly damage the credibility of other upcoming AIM IPO's but to
simply try and tar them all with the same brush is both foolish and utterly absurd.

The AIM market is lightly regulated and consequently there is a much greater element of risk with newly listing companies. Sensible investors will exercise great caution before jumping in too soon. However, if you take the time and trouble to properly research them first, there are always some potential IPO gems that can be unearthed. For example, investors in FDEV and QXT have seen the initial listing price doubling and trebling respectively in less than a year from their IPO's last summer.

[philanderer] 15/5/2014 13:31

Oh dear , think I`ll remove this one from the watchlist ;-)

[tanners] 15/5/2014 13:01

Their monthly management accounts would make interesting reading......given that the sudden reduction predominantly happened in the 4th Quarter (to end of Dec); it would seem inconceiveable that this wasnt known at the time of the float.

[deanroberthunt] 15/5/2014 12:19

all AIM is good for is a short term (day or so, or even hours) small value punt....

AIM is just a plethora of frauds, shareholder action groups, administration....and long road to the poor house

[deanroberthunt] 15/5/2014 12:17

AIM stands for, Advanced Insolvency Mechanism

it's so corrupt it's actually side splitingly funny....