Erinaceous Share Discussion Threads

[andrbea] 14/1/2008 14:53

weird day

they use the "diluted" word in the RNS
= guaranteed panic for shareholders

... and then, with stock swishing about on the floor, a 1M buy gets filled (see recent trade)

[tubruk] 14/1/2008 12:00

It's a no brainer to avoid this one. The insurance division was valued at around £92m last March and you can guarantee has gone downhill since. Not to mention lots of senior defections. So it will pay off way less than half of the debt and the share dilution will happen. Shareholders will effectively be wiped out so why on earth would anyone buy now?

[psolomons] 14/1/2008 11:21

Who knows, I simply think that if you have money to gamble with, ERG is probably a very bad place to do it. Once a company warns of a debt for equity swap you can take it that shareholders are about to lose the lot.

[andrbea] 14/1/2008 11:07

55k buy
weird that people should buy today

this after a 70k buy

mad flutters?

[andrbea] 14/1/2008 09:41

agreed high risk

FT confirms it's already down 98%




so further dilution in what's already very watery squash is all a bit relative, don't u think.. ;-)

[psolomons] 14/1/2008 09:35

It doesnt matter what price they get for the insurance arm. Shareholders will see nothing of it. The money will be used to pay debt and a dilution is still very likely to take place.

[andrbea] 14/1/2008 09:29

70k buy went thru

more buys than sells (in total)

maybe it's the interest from more than one party (not just Towergate)
means they'll get a better price for the insurance arm?

nia dyor

[tubruk] 14/1/2008 08:47

Now perhaps all the idiots who kept ramping this will realise the errors of their ways and go away! Not sure why this is new news as it was reported (I think in Property News) over a month ago.

[ch2175] 14/1/2008 08:24

Good timing there Chesty. The clue is in the word dilution. Not a solution for shareholders.

[chesty1] 14/1/2008 08:21

Glad I bailed out.......

I hope it rocovers for all you longs.....

[ch2175] 10/1/2008 10:13

Slightly off topic but in the absence of hard news the following rleates to another "integrated property services outfit". Doesnt seem like the business to be in at the moment,

[ch2175] 10/1/2008 10:04

Towergate can pick up the business along the way anyway. Apart from the 20 odd staff that they are reported to have picked up in one go they have probably been recruiting others individually as they come available. They wouldnt get involved in a bidding war if one were to break out and there is no way that they will pay a large amount to buy it as they will want a price that reflects the distressed state.
Insurance aside, what else might have some value in this market?

[yvain] 09/1/2008 22:32

CH I think you're numbers are pretty accurate - thanks for that. Towergate is certainly the most likely purchaser - I can't see anyone else who would be interested and on that basis they certainly won't over-pay. It does seem to make the rest pretty worthless as there'd still be a huge debt attached. I don't see how the Dunlop Haywards legal case can impact on the insurance arm, however, unless you're referring to the mooted in-group legal dispute. I imagine this would be dropped as part of any sale.

[ch2175] 09/1/2008 18:50

Yvain - I have had a look back at the half year numbers. In the first half of last year they made profit from insurance services of £4.9M on revenues of £19.2M. That appears at first look to be OK but doesnt support a valuation of £170M. In the same period for 2006, they managed £8.7M on £16.1M revenue. That turned into £14.4M on £29M for the full year which looks good but there are "adjustments" included to get to that profit figure and that would still put them on a pe of 12.
In the meantime however, profits were falling in the first half even before Towergate grabbed key staff. When policies come up for renewal those guys will be chasing the business and the clients wont want to place it through Erinaceous anymore anyway. On top of that, anyone who takes on the insurance arm would need to satisfy themselves that they are not going to take on huge liabilities arising from the Dunlop Haywards legal cases.
If they hit a declining profit figure of £9M in the full year for 2007 they might get it away in a firesale for £65M but I think that with so much baggage it is more likely to fetch around half that to Towergate.
With the insurance "jewel" gone I think that will still leave the rump company loss making and in debt to the tune of £200M.
The sum of the parts will be worth less than the whole and the whole thing is worthless.
Or, the figures are all wrong and it will be worth £4 per share again by Christmas.
No advice inferred.
DYOR

[yvain] 09/1/2008 14:52

CH I agree but that's the value they're after!

[andrbea] 09/1/2008 12:15

6970 pounds bought at a premium to the offer
(11.49h .. 4.15p.. 168k)

[andrbea] 09/1/2008 08:37

buys > sells

[jimmy c] 08/1/2008 16:03

get a quick trade in MEC if you want to pull some dollars back. Great strength on level 2 and reversing its fall quickly.

[ch2175] 08/1/2008 15:53

Bad luck Chesty but I think that in a couple of weeks you will be glad you stuck to a stop loss on this one. Everyone who looked at this ran away as soon as they even sniffed the books and its got worse since.

[chesty1] 08/1/2008 15:39

Sorry bailed out at 4.42p after getting in at 4.25p a massive gain not..!

Be lucky to all longs & hope it recovers for you all.

[ch2175] 08/1/2008 10:01

I think the problem is Yvain that aside from insurance the rest is all losing money and adds to a big negative. I think that you are miles over the top with those insurance arm values as well. The first half results were poor and since they were announced in September the second half has been very ugly.

[yvain] 08/1/2008 09:14

Bidding war?! This is a fire sale although I understand several parties are interested in the insurance division. The telegraph article is old news.

Does anyone know what the remainder would be worth (making certain assumptions about the continued viability of the businesses) if the insurance division was sold for say £140m, leaving about £70m - £80m worth of debt? Because that's what we're looking at here.

[andrbea] 08/1/2008 09:10

would be nice if a bidding war developed over the prime assets

eg Caan had a rumoured interest for all or part of ERG (Dec 22)
and this story too from Jan 7:

Towergate was recently rumoured to be considering a bid for the insurance services arm of troubled property group Erinaceous. About 20 staff at Erinaceous have left the ailing firm over the past few months to join Towergate.Industry heavyweights on Towergate's board include deputy chairman Patrick Snowball, who was formerly a director of Aviva and executive chairman of Norwich Union.



nia dyor

[chesty1] 07/1/2008 15:53

Looks like its just me left to either turn the lights out or make a packet.

Earlier on they wouldn't let you sell any online BUT now you can sell plenty, they want your shares.

[mark3tmaker] 07/1/2008 12:07

im out too! nice profit !