Ecofin Water&powr Opportunities Share Discussion Threads

[rob the slob] 17/8/2016 00:05

hpcg.... The zdp shares that were not taken as cash payout at end of July will be rolled over into new ordinary shares not new zdp's

[hpcg] 15/8/2016 10:46

There is already information published from early July about the new company:


You see from page 34 that whilst the new co won't have a hard discount control mechanism they will have a discount control policy.

I'm fairly sure the ZDPs roll over at the new starting NAV and thus like every thing else it cancels out once the starting gun fires. In effect the new interest rate will be about 4.3% - 7*100/163.

[langland] 15/8/2016 08:59

There is still a lot which is unclear IMO. As you point out what effect will the zdp dilution have on the nav if any. Also, if a shareholder can tender 50% of a holding, where is the cash coming from. It looks to me as though they would have to sell holdings. Maybe that's the plan. Maybe safer to wait for the circular.

[spectoacc] 15/8/2016 08:46

Doesn't take account of the rump - ie the proportion of the co that is cash and the proportion that is the "illiquid 10%" is altered by the cash return, giving what's left a lower rating than what we have currently. Still looks cheap to me mind.

Not sure I understand the effect of more ZDP holders electing to roll over into Ecofin Global, on the NAV of the newco - obviously it increases the size of it, which is the reason they've given for upping cash return for oldco.

[hpcg] 15/8/2016 08:34

Correct Rob

[rob the slob] 14/8/2016 12:19

hpcg........ I'm a bit thick. Take me through your calcs please. Will the NAV of the new shares still be c. 163 after they have paid the 50% cash out of net assets because they will cancel half the shares? ( I.e half the assets but half the number of shares too)

[rjmahan] 13/8/2016 22:08

Any idea what assets exactly other than Lonestar will be included in the realization portfolio ?

[jimcar] 12/8/2016 16:18

You will have to adjust for the reaisation fund which wil be about 10% of net assets

[hpcg] 12/8/2016 15:57

The news of 50% redemption has perked things up a bit. That will come at NAV so even if the gap to NAV doesn't close in the long term one can by 1 new share of NAV 163 for the cost of (2 * SP) - 163. As an example at 135p one ends up with shares in the 2 vehicles worth 163p for the cost of 107p.

[neilyb675] 04/8/2016 15:33

Dividend Declaration

The Company announces that the Directors have today declared a Third Interim Dividend for the year ended 30 September, 2016 in an amount of 1.8125p per Ordinary Share.

The Third Interim Dividend will be payable on Wednesday, 31 August, 2016 to holders of Ordinary Shares on the Register at the close of business on Friday, 12 August, 2016 (ex-dividend date Thursday, 11 August, 2016).

[spectoacc] 29/7/2016 07:19

@bsharman3 - sit and wait is my view. There'll be circulars coming out Aug & Sept, with the tender not going through until Sept. NAV looking healthy.

[bsharman3] 28/7/2016 18:29

Hi,
I'm a little confused about what is happening at ECWO. I am a recent holder and not sure how the restructuring will effect me and what i should do!

[hpcg] 20/7/2016 09:58

Specto - the existing ECWO fund is and was a bit of a strange beast. Lonestar was only listed at the beginning of 2013 for example. So it was part high risk VC/PE and part utility / infrastructure. The split makes sense.

[spectoacc] 20/7/2016 07:10

Thanks all - I know embarrassingly little about something I've been in for a while. Reassured to know that whatever's in the rump co, it won't be too large a % (even if I still don't see why it shouldn't be in "new ECWO", where the running costs would be better absorbed).

[wskill] 20/7/2016 06:56

Good to see the lonestar share price increasing then when I looked at it last time it was around 4%.

[jimcar] 19/7/2016 22:37

Lonestar represented 9.2% of the portfolio in June

hxxp://www.ecofin.co.uk/eco/uploads/monthreview/June_2016_Final.pdf

[strathroyal] 19/7/2016 19:47

SpectoAcc - The rump is explained a little more clearly if you follow the RNS 31/05/16 and look at the publication referred to on the ECWO website. According to the circular the rump will be made up of unquoted equity investments and illiquid assets (inc Lonestar). At 30/04/16 these were valued at £44.3M and were 4.1% NAV.

[spectoacc] 19/7/2016 17:30

Sorry @hpcg, meant this part:

"(ii) issued with shares in EF Realisation Company Limited ("EF Realisation"), a newly incorporated Guernsey closed-ended investment company that would hold the illiquid assets currently owned by the Company"

That's surely not the Lonestar stake? And if it is, again, why not put it in "new ECWO"?

[hpcg] 19/7/2016 08:56

What are you talking about SpectoAcc? The rump is the 55.5% equity holding of Lonestar.

[spectoacc] 18/7/2016 16:40

Thanks @ganthorpe - I'd gathered the tender for 35% would be at "NAV less costs", usually within a penny or so, but d'you think that may not be the case?

The cash position gives some confidence - more so if they've left it in dollars ;)

Edit - and my main concern is this "bad bank" rump - how big will it be, and will we be left with a handful each of illiquid dead shares, slowly being killed by listing/running costs? Don't see why anything they're unable to sell immediately doesn't get put into "new ECWO" instead.

[praipus] 18/7/2016 14:49

Thanks ganthorpe.

[ganthorpe] 16/7/2016 08:43

I have had a browse through the circular detailing the reconstruction plans.I have not done a really detailed analysis.
All comments are my interpretation only and DYOR if involved.

ECWO was due to be wound up or have a continuation vote as at 31 July 2016.
Hence this complex missive of a circular.
.
1) the £80M of Convertable Loan Stock will be repaid at par on 31 July 2016,THe conversion option expired on 31 May 2016. That's the easy bit.
2) the 60M Zero Div Pref shares (ZDPs) are entitled to be repaid at 160.7P cash on 31 July 2016. However ECWO are offering a rollover scheme whereby ZDP holders can opt to rollover their shares into the new vehicle planned to replace ECWO called ECOFIN Global. This would enable ZDP holders to avoid being liable to tax on the 60.7P gain on redemption immediately. The price of conversion has yet to be determined but it will need to be somewhere not too much above the share price to be attractive. It is in the interests of the Managers to get as many as possible to convert and continue to enjoy their commission , and possibly a larger Trust is beneficial to ongoing Ordinary shareholders .
3) Ordinary shareholders appear to be being offered
a) The opportunity to tender up to 35% of their shares to be repaid at a price to be determined which may be somewhere between the current share price (138P)and asset value (currently 167P).
b) Shares in a continuation of ECWO holding the remaining illiquid investments of ECWO which have not been sold , pending sale in the future. Hopefully not a lot.
c) Shares in a new trust called ECOFIN Global which appears to be a similar beast to ECWO investing in the same type of sectors.They seem to looking for an initial 4% yield. (i.e.Less than current).

All this will rumble it's way through the legal processes till September .
I hope that this is reasonably accurate but please don't rely on any part of it without cross checking.
As previuosly mentioned ECWO have already liquidated a substantial proportion of it's holdings so there seems to be plenty of cash to fund the exercise.
Will it help the ECWO share price any further? PASS!
Could reduce the discount?

[ganthorpe] 05/7/2016 15:17

Note that they have been going liquid and have £184M in cash with the Loan Stock at £79M so well on schedule for the restructuring. Asset value now 162.96P against shares at 137P , so good recovery so far with scope to move further ahead?

[topvest] 23/5/2016 09:11

Good news overall. Need to get rid of the zero preference share structure and get back to a simple capital structure. Having said that the RNS is not explicit about what happens to the loan stock an zero dividend preference shares. Anyone clear on this?

Anyway, could be some decent upside from the run off of the unlisted portfolio as well.