Cattles Share Discussion Threads

[jr50] 15/7/2009 18:55

redd

sorry to explain this to such a informed poster, but

cattles cannot favour a creditor over another whilst in this situation, even if they have enough money in the bank to pay the bondholders, they could not do so (unless the other creditors gave them permision).

i would have thought this was clear to you already?

john

[redd] 15/7/2009 18:34

jr50, todays news is most definately negative as ctt clearly was unable to renew their loan facility, money which the banks would love to get their hands on. The banks have allowed ctt another 5 months as they hope to get more money back that way. It is highly significant that ctt have not paid the bond holders. Something that they were obliged to do so clearly they are still very short of cash. You all too quickly ignore the main issue of bad debts which is what not only led to this situation but is also an ongoing problem. Hence the lack of new lending.

This recession is far from over for many as the fast rising jobless figures show. It is accompanied, of course, by rising debt defaults which will certainly affect ctt too. You can be as positive as you like but for now ctt's future is still very much in doubt.

[jr50] 15/7/2009 18:02

redd

unfortunatley you seem to be comparing old ctt with a new one,

yes, if you look at ctt's past 3 years, then you can conclude that the business was indeed unviable, bad lending criteria, aggressive loan supply, and ofcourse the fraudlent trading statements, have all contributed to bringing this company to its knees

but let not forget, there is more or less a complete change from the top, lessons should be learned, and future lending should return to less risk and lower lend, but that together with thousands of almost prime customers (prime, before the banks changed the lending criteria) at their disposal, and a more cost effective streamlined business model, there is no reason to ignore the fact that this could be a viable business once more.

most of welcomes regular customer base a few years ago, were in the 3 to 5k lend, but had disappeared from welcomes books, and this led to welcome entering the higher risk and lend policy, this was then due to the emergence of the credit card,and ease of access to these sums for the majority. but this recession will have taken care of the 'credit card' punters, and return them to subprimes loan companys like provident and welcome

rights issues, refinance and unsuspension are in the near future, tax rebates as mentioned earlier will also help in the re-lending stage.

it was a good positive today, and only the most negative posters will disagree (cannot please them all)

john

[redd] 15/7/2009 17:15

graham, I have said before that we need to know the full details from the company before it is possible to make even a half informed view of the situation. However, given that some take such a rosy view of today's announcement it was hard to resist not making some reasoned comments against.

I wonder what you made of jr50's comments today such as this......

"....but at this point, it seems to me that we are on the first step to recovery, theres still a long way to go, but a future for the company, AND a future for the shareholders is emerging. the business is viable, and a more balanced lending policy will bring profits to this company in the future....."

Seems a lot of wishful thinking, particularly the bit about being viable. Recent events prove that is certainly not the case!

[startrekker] 15/7/2009 16:26

Once they restate the Accounts and reclaim £250m of tax, things may begin to look a bit better!

[redd] 15/7/2009 14:16

Rampanddump, I agree with you that Cattles have not 'persuaded' the banks because they are the ones firmly in the driving seat and only concerned with what is best for them. It is very important to note that Cattles failed to negotiate new loan facilities and don't appear to have any other alternative funding options. Even a Rights Issue seems totally out of the question. I also note that no mention was made regarding recommencement of new lending to customers. This was the big earner so without that you have to assume the concentration is still only on cash collection. Plenty of evidence around of loan defaults still being a serious issue. Nothing said about that either. The situation looks far from good.

[rampanddump] 15/7/2009 12:00

What has been agreed is not "faith" in Cattles but an economic reality that if the banks "busted" the business for non-payment their position re the bond-holders is not yet confirmed. This is a low-risk position for the banks - they are still receiving the cash and will be reducing the facility as fast as possible - the standstill will just allow the bonds / banks to agree a formal basis to run things down.

All the extension does is put off an administration that would not be in the banks' interests now.

I am also (you will see from my earlier post) - most unimpressed that the terms of the extension have not been disclosed (nor the costs of the associated legals).

Assuming we will ever get anything back on our investment seems fanciful to me

[jr50] 15/7/2009 11:35

spectoacc

i take the negative arguments alongside the positives on board, and its very healthy to have both views on a bb.

i can see your valid points, but to say nothing has changed is not right.

ctt have persuaded 22 banks to roll over the debt for 5 months, getting all to agree is a substantial move in itself, and this includes uspn....they would have been shown cattles future plans, restructuring, refinance options, possible new business percentage etc etc,

a few months ago, we all wished the roll over would happen, now it has, we are still fighting it.

yes there can be a future d4e/run off, but at this point, it seems to me that we are on the first step to recovery, theres still a long way to go, but a future for the company, AND a future for the shareholders is emerging. the business is viable, and a more balanced lending policy will bring profits to this company in the future, to say that the banks and bondholders only want a percentage of thier money back rather then let ctt trade out of its current situation and emerge stronger, thus giving everyone a good return, is not good business sense

for most shareholders, they are looking at the shares being unsuspended, and being able to sell their shares and move on, and hopefully we are almost near that point, but for medium to long termers, we may have to hold until next year

john

[spectoacc] 15/7/2009 11:13

John - few thought admin was going to happen today; if it was going to happen at all it would have likely been months ago. There's a business to be rescued and it's in nobody's interests, including the banks', to put CTT into admin.

However - that was the situation months ago, and remains the situation now. All that's changed is CTT have left it very, very late to confirm it.

My point is simply that I don't believe this changes anything for shareholders; CTT will ultimately also agree the standstills, and get the AGM votes in, and continue in slimmed-down form. But it won't be owned by the current owners; CTT have already defaulted on their first set of bonds and will have to undergo a major refinancing (aka wipe the s/holders).

[jr50] 15/7/2009 11:03

its sad to see that some have not viewed this news as positive or no change to the current situation.

the dire facts were that the bank syndicate loans were due for repayment in full yesterday, if they were not paid, the loan could have been called in, and the company would have gone into admin yesterday evening/this morning.

cattles has persuaded all 22 banks, that it has a future, but needs time to implement, and all 22 banks have moved the payment due date to the end of the year, in fact a type of standstill agreement for 5 months.

it still needs to negotiate this debt in the future and secure further lending, in total, i believe there is £650m due in december 2009 (another debt was maturing for £150m in december)

but for now, the company has the breathing space to negotiate debt and convenants, also new lending facilitys etc etc...........they are not out of the woods yet, and have so much more to do. but if the 22 banks have put some faith into ctt, so should the shareholders.

ctt seem to declare in their rns, that they are trying to restructure their whole facility,now they have got the immediate debt moved, they can at last, concentrate on the rest of the companys restructure and finance.

a eventful august looms for us shareholders

john

[rampanddump] 15/7/2009 10:42

I'd hate to hear the bad news then.

Fairly obvious that this would happen - there was clearly no chance of the banks being repaid on the due date and with the dispute with the bondholders ongoing there was no chance of a refi - so a roll forward was always on the cards.

Interesting that they have not disclosed the terms of the extension - clearly management don't feel they have a duty to shareholders anymore.

[spectoacc] 15/7/2009 10:02

Hm I think this is exactly why CTT had the shares suspended to begin with! To stop people buying on news like today's, thinking it means CTT are nearly out of the woods.

The fact remains: the business is in intensive care, but looks very much like pulling through. But the shareholders will have to be amputated. Debt holders are going to have to take a haircut, it's inevitable (they've already missed a bond payment for eg). Debt holders rank above shareholders.

The business deserves to survive, though in slimmed-down form.

[high stock jim] 15/7/2009 10:00

very very good news :-)

[ejohn3] 15/7/2009 09:46

very good news indeed

[badhshah] 15/7/2009 09:11

Well done JR50, your knowledge and predictions had kept my hopes alive during darker times (even though at some times I have been very upset and down) and now for sure, we have survived.

[alistair4444] 15/7/2009 08:34

Good post on iii board by JR50
excellent news imo, and the best we could have hoped for at this stage, the rns also highlights bank restructuring ongoing, so there is more to come, but the immediate danger of admin has no passed.

this is what i believe will happen from now, and is only my opinion.

once ctt have resolution 6 passed at the agm, then they will call a egm (around middle of august) at this egm, they will now be able to produce accounts, and any new lending facilitys, and i would imagine they would anounce a start of lending once more themselves. its from this date that the shares will be re-listed.

it looks like they have avoided any d4e for the time being. and i do not believe they are in a run off situation.

[spectoacc] 15/7/2009 07:38

barniebear - trades have been at 1p, can only close a short there though, ie sells only.


"Cattles plc (the Company) is pleased to announce that all of the lenders under
its GBP500 million syndicated banking facility have agreed to extend the
facility maturity from 14 July 2009 to 31 December 2009.


In addition, the Company has entered into further agreements and facility
amendments with all its bank lenders and USPP noteholders with an aim towards
immediately stabilising the financial position of Welcome Financial Services
Limited (WFSL) and the Company's other subsidiaries (the Group) pursuant to
discussions around a wider restructuring of the Group.


The Company and WFSL remain in discussions with all their financial creditors
with a view to achieving a formal standstill agreement."


One banking facility sorted; still need the standstill/deal with the missed bond payment, though would expect all that to be sorted. Still don't see the shares ever coming back, though not expecting any comment on that until well after the AGM.

[barniebear] 15/7/2009 07:17

Is there any trade in share price in the grey market & if there is at what SP!!

[tom111] 15/7/2009 07:13

Good news at last

[typo56] 14/7/2009 09:15

Cattles last-ditch talks go on as deadline looms
STRICKEN sub-prime lender Cattles was last night locked in eleventh-hour talks with its banks and bondholders, as a key refinancing deadline looms.

[w.bramley] 14/7/2009 08:58

I would not write it off just yet, agree not looking good but we will see. RBS improving.

[airways01] 08/7/2009 17:55

8 July 2009






Following the continued suspension of Cattles PLC (UK), FTSE announces the following changes:

INDEX
CHANGE
EFFECTIVE FROM
START OF TRADING

FTSE All-Small
Cattles (UK 0180366) will be deleted at 0p.
13 July 2009

FTSE Fledgling
Cattles will be deleted as above.
13 July 2009


Please Note: in accordance with the FTSE ground rules if a company is restored to trading on the Main Market, it will be re-included to the FTSE Index.