Ediston Property Investm... Share Discussion Threads

[skyship] 10/9/2023 08:48

"I disagree that "if you were invested in EPIC you should be looking to reinvest in REITs", in my opinion you should be looking for the best opportunities"

Totally agree, but for sure some of the best opportunities rest with REITs. The sector has been particularly badly hit by rising interest rates; however, as always, the Market overdoes things at both the top and the bottom of the cycles. Clearly, massive discounts and covered yields of 8%+, provide Opportunity.

Personally I'm an asset player, hence the REITs. But also like proven assets underground; so have recently added to my GGP holding. They are rapidly digging down to a massive gold orebody, with first production expected Q2'24. The imminent ASX listing will overcome the weaknesses and vicissitudes of their AIM listing. Sp now 6.25p. Expecting well North of 8.5p once the Aussie funds are able to buy in.

[fordtin] 10/9/2023 08:01

“
Alan PT 9 Sep '23 - 12:21 - 1925 of 1926
@marktime1231 My intention was only to contribute to the thinking on where to invest proceeds

I disagree that "if you were invested in EPIC you should be looking to reinvest in REITs", in my opinion you should be looking for the best opportunities

But I accept that it's off topic, apologies for that
“

I agree with Alan PT, except I don’t see any need for apologies.

Many have already sold, others might be planning to sell or be in the process of doing so. If the major holders vote for this deal, anyone still holding will soon have the sale forced on them.
What they do with the proceeds is up to each individual and I doubt I’m the only one interested to read what others are doing, or considering doing, with their funds.

I’ve been selling small tranches of my EPIC shares for several weeks. I’ve used the funds to top up on other companies in my portfolio, with only a small amount going into other REITs.
I haven’t yet decided what to do with the remaining ~20% of my EPIC shares, hence my interest in other people’s plans.

[spectoacc] 09/9/2023 12:38

#5100-ish onwards on the CP. thread @Skyship, shan't repeat it here.

[alan pt] 09/9/2023 12:21

@marktime1231 My intention was only to contribute to the thinking on where to invest proceeds

I disagree that "if you were invested in EPIC you should be looking to reinvest in REITs", in my opinion you should be looking for the best opportunities

But I accept that it's off topic, apologies for that

[skyship] 09/9/2023 11:55

Specto - re yr 1910 above:

"EBOX isn't cheap IMO. Isn't expensive, but there's plenty to still be worked out on EBOX IMO. But depends who you listen to."

At 52.4p the NAV discount is 42.6% and the yield 8.28%.

Explain your reservations please. Though before doing so view the last results Presentation in the EBOX Header. In particular view the Revenue Bridge which provides considerable detail of their building income sources.

Then try to justify your comment.

[marktime1231] 09/9/2023 11:27

(Not that it is relevant here, if you were invested in EPIC you should be looking to reinvest in REITs whether domestic minnows or US giants and that conversation is on topic; but neither GSF nor GRID have any appeal right now and are not the topic here. GSF has always under-performed even when the BESS story was at its most exciting, and is currently trading 18% below launch in 2018. GRID has hit the skids because it has failed to deliver its promises. Both are about a third off their peak price over the last year, neither is generating attractive income, the outlook is for things to get worse before they get better. I think people say do-your-own-reasearch at this point but what I mean is do your off topic pitching elsewhere please and thank you).

I had initially read the terms of the deal to mean that it was 72p plus the September dividend at least. It would be pretty sneaky for the timing of completion and the timing of the dividend payment to mean we get 72p less the September dividend. Without spelling that out. If that is the case it just made a disappointing deal even worse. Plus the lost opportunity unless you quit now, because we are also missing out on Oct-Dec income while waiting for EPIC settlement.

Grrrr.

What to do ... hang on for 71p or quit now at any price.

Any chance of a non-aligned shareholder dissenting?

[chucko1] 09/9/2023 10:57

Couple of things:

1) an annualised 11.25% (seemingly the minimum, regardless of RNS interpretation) compares well with alternatives such as MM funds, merger arb funds (which have averaged circa 7% the past few years). To say there are better uses for it with certainty (or even confidence) suggests a lack of interest in diversification or view of risk, in my opinion. Taking a different risk does not guarantee an equivalent or higher gain, or even a gain at all.

2) responses to my assertion of available trading gains seemed to focus on frictional costs. Well, that would be fine if "trading" is only a matter of short term decisions. Far, far from it. Needy sellers (or those with inadequate risk tolerances) can provide opportunities in a multi-week timeframe. Idiotic Gilt valuations can do the same but in multi-month or year timeframes. For example, I call selling SUPR at 130ish and averaging back in from 100 to 73-odd "trading", although I accept that one might label it as asset allocation, considering the period involved. Neither case is too concerned with friction! It is concerned with valuation, and that means not holding indefinitely as though a religion.

But also, I would not rule out reversing a position within an hour for 2%. Those 2%s really add up, even if they don't provide the rush some would crave for.

[fordtin] 09/9/2023 10:48

As the company will be XD on 28th September, I'm not expecting the 29th September dividend to be deducted from the 72p, as that particular dividend will be a liability at that point in time.



“
... the Company expects, immediately following Completion, to have net assets of approximately GBP152.2 million (the "Estimated Net Assets"), equivalent to 72.0 pence per Ordinary Share ....
“

“
...."The Board expects that, subject to the approval of the Resolution at the General Meeting, completion will occur on, or around, 28 September 2023." ....
“

[flyer61] 09/9/2023 10:08

It is likely there will only be one more dividend. Expecting it will be all done and dusted by first week in October. Holding till the BITTER end...

Not really the outcome I had hoped for..

Look at the occupancy levels, the concentrated portfolio in the right asset class, cash on Balance sheet...grrrr

Will try and find out where Calum goes as intend to follow if he ends up managing another REIT.

Maybe O Realty will take him on.

Think I will take on O in my SIPP.

[rogerrail] 09/9/2023 09:50

Not quite. You will get 72p at liquidation minus any dividends paid between completion and liquidation. So all dividends until completion will be on top of that.

[spoole5] 09/9/2023 08:50

Sorry if I'm being a bit thick here but if you hold until completion and pick up the divis will you get paid out 72p?

[wskill] 09/9/2023 08:28

Poor effort by directors here that is why they have strung out the negotiation to bore shareholders into accepting, anything would be better than the limbo enforced a good tactic by the American buyers ,typically useless UK directors not fit for purpose.

[spectoacc] 09/9/2023 07:16

Thanks nickrl/Alan PT, noted re GSF/GRID.

GSF have diversified, but surely what they've still got in UK is going to be hit? Albeit seemed fine at recent t/s.

@Flyers61 - very true of most of them.

@Perfect Choice - surely all discussed above: 72p plus divis until completion, when it becomes 72p less divis.

[alan pt] 08/9/2023 22:52

@SpectoAcc GSF over GRID any day

GSF 27.5% NAV discount, near term cover for 9% dividend, well diversified

"In 2018, we identified the vulnerability of relying on a single market and the volatility it introduced to our revenues and overall profitability. We made our first international acquisition in 2019"

GRID 15% NAV discount, uncovered 6% dividend, very late to the party diversifying outside UK with only one non-UK asset, still in development

"Gresham House Energy Storage, the UK's largest battery fund, blames National Grid for a fall in revenue and dividend cover"

[perfect choice] 08/9/2023 20:44

So I'm reading a different view of the RNS text below and whether holders will either get 72p plus dividends paid before liquidation, or 72p, reduced by any dividends paid before liquidation.

Key issue is interpretation of "unless" in sentence "the estimated amount per Share available for distribution to Shareholders in the liquidation .... is expected to be materially the same as the Estimated Net Assets per Share of 72.0 pence, unless and to the extent that any dividends are paid in the period between Completion and liquidation."

So I am reading that as a condition to the value of NAV (£152.2M) equating to 72p, so if dividends are paid out that leaves less for the final value per share payout, so dividends are in effected deducted from 72p.

Now more than happy to be told that is wrong and dividends are on top, if that is the case can somebody explain please.

Financial effects of the Disposal on the Company

-- The Property Portfolio comprises the entire business
of the EPIC Group. After adjustment for estimated transaction
costs, the Company expects, immediately following Completion,
to have Estimated Net Assets of approximately GBP 152.2
million, equivalent to 72.0 pence per Ordinary Share[1].
-- The Estimated Net Assets per Share equates to a 17.7
per cent. premium to the Share price of 61.2 pence as
at 15 March 2023 (the closing price immediately prior
to the Strategic Review Announcement), a 14.0 per cent.
premium to the Share price of 63.2 pence as at 2 August
2023 (the closing price immediately prior to the Strategic
Review Update Announcement) and a 10.8 per cent. premium
to the average Share price over the twelve months to
2 August 2023. The Estimated Net Assets per Share equates
to a 10.8 per cent. discount to the latest published
net asset value per Share of 80.77 pence, as at 30 June
2023.
-- If Shareholders subsequently approve the voluntary liquidation
of the Company on or around 31 December 2023, the estimated
amount per Share available for distribution to Shareholders
in the liquidation (taking into account the estimated
costs of liquidation, service provider termination costs
and estimated net income in the period following Completion)
is expected to be materially the same as the Estimated
Net Assets per Share of 72.0 pence, unless and to the
extent that any dividends are paid in the period between
Completion and liquidation.
-- No transitional services arrangements in respect of
the Property Portfolio will be required following the
Disposal as Realty Income will take over the management
of all the assets within the Property Portfolio immediately
upon Completion. The Company will not, therefore, incur
costs in implementing transitional services arrangements
in respect of the Property Portfolio going forward.

[williamcooper104] 08/9/2023 17:56

Yep - and the pain of having to use CFDs to dodge UK stamp duty which otherwise really eats into trading returns

[nickrl] 08/9/2023 17:37

@specto GRID is way off covering its divi which was to be expected given build out but further delays to new sites and their strategy of one hour batteries isn't competitive now the markets got saturated. There could also be the first cracks appearing in the all out pursuance of renewables after AR5 today failed to get anymore offshore wind. High penetration of renewables is key to batteries long term success imv.

[flyer61] 08/9/2023 17:31

The other point about 'trading' these REITs is doing it in any size is tricky!

[spectoacc] 08/9/2023 17:02

D'you trust ROOF? GSF interesting, but maybe GRID is the dcb pick now? EBOX isn't cheap IMO. Isn't expensive, but there's plenty to still be worked out on EBOX IMO. But depends who you listen to.

EPIC gain has the advantage of being safe, assuming vote gets passed (& they seem confident).

[riverman77] 08/9/2023 16:56

Really wouldn't bother holding on to these now for the sake of a couple per cent. Lots of bargains around right now that might not be around much longer - EBOX, GSF, even ROOF looking interesting.

[spectoacc] 08/9/2023 16:52

Yes, isn't the Sept divi from August earnings? Hence we may get a further one. They say "..Unless and to the extent.." re divis, but say elsewhere that they'll continue to pay them.

Still - we're talking fractions of a penny. I'm holding on for the 72p+, if only because the RSPs won't give me anything near bid price.

[chucko1] 08/9/2023 16:50

Yes, I see, so on that basis, a return of 2p (assuming 70p value as of tonight's close) + 0.417p + 200mn at 5% (ha ha) for 3 months minus completion costs. This brings the annualised return to 11.25% (annualised) - something still worth having. Will not bother selling on that basis.

[stemis] 08/9/2023 16:42

So value 72p + September dividend

Even that is ambiguous as the September dividend is paid (on 29 September) potentially after completion (on 28 September).

[spectoacc] 08/9/2023 16:34

Yes, so it's completion that's key, and searching further suggests that means only one more monthly divi in addition to the 72p:


"Completion of the Disposal is conditional only upon the approval of the Resolution by Shareholders at the General Meeting. The Board expects that, subject to the approval of the Resolution at the General Meeting, Completion will occur on, or around, 28 September 2023"

[rik shaw] 08/9/2023 16:33

Yes if Completion date is end Sept then Revenue would stop at that point and the only cash they would have be the 72p and any interest they might earn on it. So the only dividend that is covered by Revenue is potentially the Sept one recently announced. So value 72p + September dividend.