Datong Electronics Share Discussion Threads

[deepvalueinvestor] 08/3/2013 20:08

Praipus, Datong beat a much larger competitor to the contract announced in December and I certainly think there must be a reasonable chance that they could be one bidder. This is a real niche area so not a bidding war between international companies a possibilities. No debt, £2.5m cash in the bank and an interesting little company so why not a final takeout at £1+ a share? That's only £13m+

[badtime] 08/3/2013 20:05

For starters they want to be bought :)And they are further along the road of restructuring LCG have only just started (with a change of board)

[praipus] 08/3/2013 20:00

I sincerely hope so LCG is in the "some you lose category" so far..

So what makes you think DTE might be better?

[badtime] 08/3/2013 19:20

Praps I think this may be better than LCG

[checkers2] 08/3/2013 19:12

I think that the shares offer good value even at these levels with the buyout fizz.

[praipus] 08/3/2013 15:52

Guy Thomas and the Hazell Carr vehicle is holding 5.84%

I wouldnt buy too many I've seen a few of these fall through recently:(

[praipus] 08/3/2013 15:23

No, sorry, I assumed it was 3% like the main market.

[checkers2] 08/3/2013 14:37

Thanks Praipus. Do you know what the disclosure % is for AIM under normal market conditions ?

[praipus] 08/3/2013 14:30

I track all Guy's known or RNS disclosed positions on the WAM thread:)

[praipus] 08/3/2013 14:29

Its due to takeover talks and entering formal "For Sale" process, just a formality not a recent purchase as far as I can tell.

[checkers2] 08/3/2013 14:24

Good to see Guy THomas' vehicle has a position in this stock today.

Announced today shareholding of 807,500 shares, 5.84%.

Does anyone have knowledge of disclosure rules for AIM shares, ie what is the minumim percentage that is notifiable ? It is 3% on the main market, not sure on AIM.

I assume he has had this position for a while, and as disclosed because the company is in a sale process. I don't imagine he could have made this position in the last few days.

[2baffled] 06/3/2013 10:37

Pro-active video interview;

Dart Energy has one of the "largest shale" positions in the UK
Tuesday, March 05, 2013

John McGoldrick, CEO at Dart Energy (ASX:DTE) tells Proactiveinvestors that the shale position it holds in the UK is one of the largest around and it has largely gone unnoticed by the investment community. John also says that Dart is looking at a London IPO which will help it cement its position here and gives investors in the UK a further opportunity to take part in the sector.

[orange1] 24/2/2013 21:17

I think that another way of arriving at a take out price is to look at a multiple of sales. One to one and a half would be appropriate here leading to a take out price range of between approx. 75p and 115p.

[deepvalueinvestor] 24/2/2013 20:12

Thanks Michael. It all seems logical. I had a conference call with management in January and was really quite shocked that nobody else had picked up on the relevance of the contract news and the fact that they beaten off much larger competition. I was quite happily nibbling away until I saw both your note and one from another tipster and this led me to pick up stock on Wednesday at 38p and 39p. I imagine the announcement was triggered by this renewed interest.

With such a low market cap, and in such a niche area, it is not unimaginable that we could have a few bidders and that may include the company that it beat to the latest contract. I thought about taking profits at 50p but when I looked again at the numbers, the shares are arguably still a buy rather than a sell.

As you say, sometimes a long term value play can become a target when it is so under the radar.

[michaelmouse] 24/2/2013 19:26

Update on my thoughts:-



Michael.

[hezza123] 23/2/2013 00:21

I did let some go at 50.5, owing to both the proximity to TNAV and the fact that I also wanted to pick up some of the Paragon bond before books closed. 60p+ is certainly feasible, but nothing in life is guaranteed. I'm also bound by my own rule of always taking a profit if the discount has narrowed sufficiently. Can now relax about the outcome of this and hopefully buy more if the price drifts on no news. Good luck all. :-)

[deepvalueinvestor] 22/2/2013 17:52

I thought about trimming my significant exposure at 50.5p but I agree with the posters here that any bid would surely be 60p+ and possibly much much more. I was particularly impressed when they beat off larger competition last year for this r&d contract and I wonder if the other party is now the potential bidder.

[hastings] 22/2/2013 14:54

Well, it depends on what price the major holders accept. They may be happy to let it go for less than some think.

[jojo_jo] 22/2/2013 12:47

Still looking a bargain at 55p. Price jump today on the news was pretty tepid considering. I expected it to race much higher, and am sure it will very soon.

Decided to take a few, as I expect bid to be at least £10m (nice round figure), with an upwardly revised later bid likely and the distinct possibility of a rival bid appearing now it's 'in play'.

Every chance of hitting £1.00 by the time this plays out.

IMPO/DYOR/NAI
Jo

[anothertim] 22/2/2013 11:59

Datong's technology is pretty well respected as is the technology they resell on behalf of third parties.
(I used to be in this area of the IT industry, but feel free to believe me or not!)

[hastings] 22/2/2013 11:26

Pretty good if you go by these!

[checkers2] 22/2/2013 11:12

Anyone got an how idea how special their technology is?

[checkers2] 22/2/2013 11:11

EV/EBITDA multiple would have to be a minimim of 5 for this transaction imho.

This gives share price of around 85p.

Large PE dealer Blackstone made buy out at average of 9.5/10 for 2012. Obviously for different / larger businessses.

But ratio here would be less given size, and market niche which is less transparent.

If a bidding war started it could go over 100p if the technology they have is really interesting, but not sure how cutting edge it is.

[norbert colon] 22/2/2013 10:40

I got in at 30p a while back and think a 10m GBP valuation / take out valuation is the minimum we can expect based on BV and sales alone. Hence 72p (min)...

Lets wait and see.

Just annoyed (again) for not having more conviction in some of my investments!

Nobby