Brixton Share Discussion Threads

[gatdecor] 15/6/2009 12:34

why the dive?
segro also now down 6%

[hamsterape] 15/6/2009 11:43

Exactly my thinking re. last paragraph.

I initially put on the long BXTN/short SGRO arbitrage trade,
but both sides immediately went against me.

Decided to average down on BXTN but didn't increse the SGRO short
because of the bullish-looking ascending triangle and the risk of
a big break upwards if the deal did not go ahead. In the end I
closed the SGRO for a reasonable profit aiming to put it back on
if the price recovered, but it has stayed low and this talk of a
rights issue is clearly not going to encourage fresh buyers.

It's quite possible the deal has already been agreed in principle. As
the SGRO price falls so does the deal value to BXTN holders, hence
BXTN might be a bit weak too for that reason.

[madasafishman] 15/6/2009 11:11

hamster
thanks for spelling correction on here my posts are typed quick as at work I have to be discreet :-)

re:other bidders I would say they def would have had other interest once it was known the company was for sale....as too how many would have been serious or just competitors feeling the company out..we will never know

price wise it is common to drop the price sharply on the day a bid is accepted
why they do it and how they get away with doing it is another story..but ive been caught out before by that..as most investors think the deal is off due to price drop and sell or just get their stops hit

this really is turning into more of a gamble for me the longer this goes on
and am having some doubts on what the potential upside will be if a bid materializes

[hamsterape] 15/6/2009 10:53

Fireplace

My average is about 69p so I may have to trade in and out and scalp
a penny here and there. Can't seem to get a sale away at anywhere
near the quoted high trade of the day for the last few days, which
is irritating.

Madfish - do you think there really are other potential bidders, or
is it just a bit of brinkmanship on BXTN's part?

Prices do odd things at times - I remember when Marconi where being
bid for by Ericsson - the price dropped (albeit only briefly)
on the day of the announcement. That was like pennies from heaven.

[gatdecor] 15/6/2009 10:36

segro are down 5% today.

[madasafishman] 15/6/2009 10:25

hamsterape
its funny ive been thinking about the price this morning
and was thinking a fairly average figure for quite a few takeovers ive been involved in is 30% above the price when interest is first indicated
ie:54p bxtn which makes approx 70p the price then if it is considered serious bid sits at approx 10% less untill deal is done which would make 64pish which seenms to be in middle of trading range at present
other times it can jump wildy for a few months testing previous lows so this is not
a guarenteed formula by any means ...just a few thoughts dyor

so perhaps my early figs of 1.10plus are a bit optimistic

bxtn have to either except a bid or renegotiate the end of june covenant...unless of course they already have un officially

as always the public shareholders are the last to know

[fireplace22] 15/6/2009 10:16

Hampster, depending on the relative size of each block you could do that now and take no further risk.

[hamsterape] 15/6/2009 10:04

All I'm saying is the assumption that people have been making
that SGRO wil bid shares or cash and shares to a value of 80p
or more may well be flawed.

I'll be grateful to get out at minimal loss after paying a range
of 64p up to 72p for blocks of BXTN.

[sportbilly1976] 15/6/2009 09:58

gatdec0or,

i think that is what he is saying (although that is not advice!)

if SGRO were to offer shares from BXTN and offer a reasonable premium, then the logical trade would be to sell your SGRO stock and buy BXTN - post offer you would have more SGRO for your money.

[gatdecor] 15/6/2009 09:55

hamster so what are you saying should we sell any buy segro?

[hamsterape] 15/6/2009 09:37

Be careful, guys.

Because of the debt and covenant problems it's entirely possible
this takeover will not command much of a premium, if any at all.

The last few days have seen lots of purchases of SGRO and short sales
of BXTN - it ought to be the other way around if a premium is expected.

I've noticed lots of instant bot-matching on the offer on Level 2 within
the last half-hour or so. A big seller was absorbed very quickly. Things
might be hotting up a bit.

[quepassa] 15/6/2009 08:24

If Segro are, according to the week-end press, now sounding out financial advisors on fund raising/equity raising, many commntators would interpret this that discussions between Segro and Brixton have been progressing satisfactorily, if not coming to a head - and perhaps prior to 30th. June.

All IMO. DYOR.

QP

[madasafishman] 15/6/2009 08:19

scburbs
they may have already arranged for a large proportion of the shares of a new rights issue to be taken up by intstitutes/funds leaving only small percentage for private shareholders this would give the banks some more confidence and as you say would not neccasarily take a long time to implement

[scburbs] 15/6/2009 07:52

I think SGRO could do the rights issue after the takeover, provided they have sounded out the shareholders in advance, although rights issues don't seem to be taking very long to organise at the moment.

One key question would be whether the BXTN shareholders are asked to take part in the rights issue (i.e. share for share then rights issue). I think the shareholder bases are quite similar anyway.

[fireplace22] 15/6/2009 07:40

Presumably the rights issue would significantly delay the takeover? But then again if it takes too long Segro might have their target bid for by a third party, rendering the rights issue useless. Or would they bid first and rights later?

[scburbs] 15/6/2009 07:35

Thanks Fireplace22. Should be time for some news soon.

The rights issue would be to deal with BXTN's debt, so I think a pure share for share is still most likely, although the rights issue could increase the chances of a small cash component.

I was expecting some more disposal news from BXTN before now as the closer they get to 30 June (without an alternative strategy) the greater the leverage that SGRO has to squeeze the price. Again the BXTN board seem a little slow.

[fireplace22] 15/6/2009 05:29

Segro rights issue?

[fireplace22] 14/6/2009 13:38

Found this on iii (posted yesterday)thanks to Cautious optimist

Property Week yesterday reported that Segro was considering tapping shareholders for a further £300m to fund repayment of Brixton's debt falling due in the next 18 months. It is suggested this would be after agreeing takeover of Brixton - though presumably Brixton's lenders and bondholders might require a fully underwritten rights issue as a precondition for agreeing not to call in the loans and bonds following expected covenant breach on 30 June.

Any further information?

The suggestion comes from SocGen and is for £300m subscription at 20p each (which to me seems quite precise and may therefore suggest this is a real proposal). SocGen was one of the lead managers on the £500m capital raising in April.

[tiger60] 12/6/2009 15:57

This weekend.

[sportbilly1976] 12/6/2009 13:36

current level 2:

[gatdecor] 12/6/2009 11:29

any info SB ?

[hamsterape] 11/6/2009 18:49

Not THAT interesting! - only 191k got matched in total in the auction,
so if either of those lumpers were willing to pay up to 67/68p they must
have pulled them, or else they were big sells at that price and didn't
get hit at all.

[sportbilly1976] 11/6/2009 15:32

interesting appearance of a 250k order at 67p and 690k at 68p for the auction..