Deepmatter Share Discussion Threads

[1347] 01/12/2022 10:51

PW Indeed it is 12.25% so they would have to be going to at least 5 subscribers for none of them not to be notifiable, even if they currently held zero shares. In my view this should have been disclosed in the RNS.

[pwhite73] 01/12/2022 10:34

1347 - I had spotted the missing 800 million. That's 12% of the total 6.5 billion shares. 12% is a notifiable interest as its over 3%. Who is buying 800 million shares to have them all cancelled in a month's time?.

Like the directors and major shareholders that person or persons are not interested in the shares what they're after is a stake in the company for when its sold privately.

They announced the delisting to crash the share price. When the share price is crashed they issue further shares at the crashed price to give the impression they are placing stock at the current market price. This also serves the purpose of giving them sufficient stock so all the resolutions are passed in their favour. Is this not a case of insider trading?

[the ghost who walks] 01/12/2022 10:01

How do you apply for subscription shares, is it too,late?

[the ghost who walks] 01/12/2022 09:58

Worth buying in and holding as a private investment?

[pwhite73] 01/12/2022 07:51

Directors and major shareholders investing an additional £1 million at 0.04p in the company's shares only weeks before a delisting. They are not throwing good money after bad that's for sure. They clearly see huge potential for the company. If you're in its not worth selling if you're out it may be worth following their lead at 0.04p and tucking these away.

Its still unclear to me why the FCA has not forced them to takeover the company which is in effect what they are doing but claiming financial destitution as an excuse.

[terminator101] 01/12/2022 07:30

Oh dear, seems the market knew the massive discount for that raise already huh.

[1347] 30/11/2022 21:04

sn No, it's not wrong, it's you that can't understand plain English, but yes we'll not continue this pointless discussion any longer.

[supernumerary] 30/11/2022 20:37

1347 - you're wrong, but whatever, I'll leave you to it.

I have to refute your suggestion that 'we can agree that DeepMatter is just another tin pot AIM lifestyle, jam tomorrow company'. That may be true, but I don't have enough information to make a decision. I think they may be well-meaning individuals doing their best for shareholders and society who've hit a brick wall, largely because they underestimated the difficulty of the task. Insufficient public information to decide.

[1347] 30/11/2022 20:13

I did not say there was a conspiracy, only that now that I had looked into it in more detail that I could see that most of the significant shareholders that are identified as forming part of the: 59.3% of the Company’s AIM securities that are not held in public hands, would do so because they came into category 1(e), the definition of which I posted earlier. That is not 'my evidence' that information is published on the DeepMatter website and the definitions are in the FCA handbook, which you seem to ignore. I see no point in discussing this further, although I think we we can agree that DeepMatter is just another tin pot AIM lifestyle, jam tomorrow company, of which there appears to be no shortage in the UK.

[supernumerary] 30/11/2022 19:21

PW - it's not at all unlikely - what is unlikely is that they'll allow an offer to be made that they're not happy to accept. There's nothing so far to suggest that they're a member of the party, so they'll be in the same position as other shareholders except of course better informed.

1347 - What you're misinterpreting is the meaning of that paragraph. In this context, the 'concert party' is that 5%+ shareholder, not the lot of them together. So there are 5 such here, with 'Griffiths and controlled holdings' being the only one that would conventionally be considered a concert party. The fact that they all appear together on the same list of shareholders does absolutely not make them a concert party together.

I make the same comment as to PW - your search for a conspiracy (for which as yet you've adduced no evidence) is colouring your judgement.

But finally, I have no stake here - as I said it was too scary from the start - so I'll leave you all to work it out for yourselves and will just follow from the sidelines. Good luck all holders!

[1347] 30/11/2022 18:25

super - "acting in concert" is the phrase used by the FCA

(e) any person or persons in the same group or persons acting in concert who have an interest in 5% or more of the shares of the relevant class

Acting in concert

Persons acting in concert are also known as a concert party. A group acting together in a takeover situation. As defined in the Takeover Code (the Code), persons acting in concert are persons who, pursuant to an agreement or understanding (whether formal or informal), co-operate to obtain or consolidate control of a company or to frustrate the successful outcome of an offer for a company. Control in this context means 30% of the voting rights in the target company.

Ok I know we are not in a formal takeover situation (yet) but the situation is the same so I'm not sure what it is that I'm misinterpreting here?

Yes, there are risks with all shares and obviously a lot of new companies have to raise funds to progress their potential, everyone has to form a view on that risk. I expected DMTR would come good over time, I didn't spot soon enough just how underhand Warne was/is and how much in hoc he was with the big holders, to the detriment of smaller share holders. I expected some bad apples on AIM but it seems to me as if almost the whole orchard is rotten.

[pwhite73] 30/11/2022 18:24

supernumerary - "And the price paid is of no importance if the payer isn't a member of a buyout concert party."

I agree although wholly unlikely the second biggest shareholder with 11% is unlikely to be a member of the buyout party. He alone can stop the buyout as the maximum the buyout party can achieve is 89% of the shares not the 90% required.

[supernumerary] 30/11/2022 17:51

1347 - You're misinterpreting this - of course they fall into Category 1(e), but that does not mean that they are a concert party with the other holders who also hold more than 5%. You seem to be assuming that say Springer and Trillian are in a concert party together, when in fact we have no information on the matter, and it seems rather unlikely to me. It's absurd to suggest that they're all in concert together.

I don't think hindsight was needed to see at the outset that this was extremely high risk - there were huge warning flags from the start.

PW - see comment above about the concert party - you're also wrong. And the price paid is of no importance if the payer isn't a member of a buyout concert party. I'm not sure why you're so keen on this conspiracy theory, but it isn't helping your analysis.

First you say 'has wind of' now you want it 'set in stone'. As you wish...

[pwhite73] 30/11/2022 17:35

supernumerary - "PW - the market already has wind of a forced buyout, and yet nobody's buying,"

There is nothing in stone to suggest this yet. Shareholders need to see the details of the £1 million funding first. Even if it is a forced buyout the highest price paid by a member of the buyout party on 26/08/2022 was 0.11p.

Not in public hands and the concert party are one and the same people holding 59.3% .

There may be other major shareholders holding 3% or above but they are not part of the concert party.

[1347] 30/11/2022 17:04

No I disagree, it's not wrong, the inference is correct. The rules as above are now clear to me, 59.3% are not in public hands hence they must fall into one or more of the categories 1 (a) to (e) or 2 as above. Looking at those named shareholders, other than the directors, they will most likely fall into category 1(e).

I do agree with your second paragraph though. As I said I've come to the conclusion, after discussing it with Captain Hindsight, who's never around when you buy in, that DeepMatter, like many AIM companies, are best avoided as an investment, though some are useful for trading, if that's your game.

[supernumerary] 30/11/2022 16:47

1347 - your inference is wrong and you have no evidence to support it. As far as we know these other major shareholders are just that: they've been approached by the board for their views, and may have been made insiders at the time, but that does not make them a concert party.

The problem here isn't the makeup of the register, but the fact that it's very high risk, has bled shareholder cash for years, and shows little sign of turning to profit in the foreseeable future. Hence it's struggling to raise funds. That's the profile to avoid I would suggest.

[supernumerary] 30/11/2022 16:40

PW - the market already has wind of a forced buyout, and yet nobody's buying, indeed quite the opposite. Should the buyer reach 90% and be able to squeeze out the remaining shareholders, there would be no point in buying in the market for more than the offer price as it would be a guaranteed way to lose money.

As for what it's worth, I doubt any meaningful premium over the current price will be offered, and even so I expect it to succeed - it's generally pretty easy for incumbents to get the necessary 75% in a scheme of arrangement. The only real way to fight it off is to find a white knight, and I see little sign of knights or cavalry coming to the rescue here.

[1347] 30/11/2022 16:35

Almost, you missed off the bit about concert parties in (e). From the FCA (who are good at writing rules but useless at enforcing them):


For the purposes of LR 6.14.1R and LR 6.14.2R, shares are not held in public hands if they are:

1) held, directly or indirectly by:

(a) a director of the applicant or of any of its subsidiary undertakings; or
(b) a person connected with a director of the applicant or of any of its subsidiary undertakings; or
(c) the trustees of any employees’ share scheme or pension fund established for the benefit of any directors and employees of the applicant and its subsidiary undertakings; or
(d) any person who under any agreement has a right to nominate a person to the board of directors of the applicant; or
(e) any person or persons in the same group or persons acting in concert who have an interest in 5% or more of the shares of the relevant class;

2) subject to a lock-up period of more than 180 calendar days.

So what I infer is that 59% of them are indeed acting in concert, which is Griff plus most of the other significants. What I then take from that is that it's best, as a retail investor, to avoid such companies in the future as an investment as they are too risky and may delist, so they are only useful for short term trades around spikes, if you can predict them. Just reinforces my view that, with few exceptions, AIM is a waste of time unless you are an insider.

[1347] 30/11/2022 15:28

It depends what you mean by associated with the company doesn't it, just because you are a significant shareholder doesn't mean that you are associated with it. It's also not been stated that they are acting in concert.

[pwhite73] 30/11/2022 15:13

FCA confirms new Listing Rules to boost growth and innovation on UK stock markets
Press Releases First published: 02/12/2021 Last updated: 02/12/2021

"Reducing the amount of shares an issuer is required to have in public hands (i.e. free float) from 25% to 10%, reducing potential barriers for issuers created by current requirements."

[pwhite73] 30/11/2022 15:05

1347 - "So what I still don't see is why they have to delist to do that,"

A listed company must have 10% or more of its shares publicly trading meaning in the hands of people not associated with the company.



"Shares not in public hands - In terms of AIM Rules revised in March 2018 and insofar as it is aware, at 31 May 2022, 59.3% of the Company’s AIM securities were not held in public hands."

This means people associated with the company already own 59.3% of its shares.

Therefore unless they have been dumping since 31/05/2022 they can only acquire another 30.6% of the shares without being in breach of listing rules. They would need special permission from the FCA to hold more than 90%.

If they intend to pump another £1 million into the company as shares at its current market cap of £1.4 million then they will certainly be over the 90% limit.

Technically they have to delist unless they receive a waiver from the FCA.

[1347] 30/11/2022 14:38

So what I still don't see is why they have to delist to do that, they can do it as a plc, offer a low price and still sell on for multiples in the future if it's really worth a lot (I'm not convinced it is right now). Either way that wipeout placing looks very contrived to me as it crashed the SP, meaning that if they time it right they will be able to offer a much lower price in a forced buyout than might have been the case. The FCA if they were any use would be looking at this closely.