Yep - we were very lucky that the lender was Lloyds; many others with less concern on the political risk would just have put it in admin |
FCA always been a farce - the money will be spent by the culprits before they ever get after the HOME boys.
But it's always the co gets fined for its own failings - the directors are ultimately employed by the shareholders after all.
Former Alvarium action could go on years of course, but will HOME? |
I'd be very surprised if the FCA allowed the company to relist given the huge dependency of the share price on the outcome of its own investigation. The FCA itself is under increased parliamentary scrutiny so I would hope that they'd be aware that 'bayoneting the casualties' after what could be viewed as a £500 million regulatory failure is unlikely to go down well in Westminster.https://www.investmentweek.co.uk/news/4382742/fca-urged-adopt-reforms-mps-warn-watchdogs-integrity-called-questionThe APPG report concludes with the following statement:"It istempting to claim that the FCA is now 'drinking in the last-chance saloon'. But the problem is worsethan that: the bar is about to close, and the regulator is at risk of being thrown onto the street"Ouch! |
True, including the FCA when they fine the company.
But IMO SW couldn't have liquidated it - or rather, far better/cheaper to have shareholders pay AEW to do it for them over time. Pulling the plug would have been hugely expensive/disruptive.
Not that I blame SW, but sticking to the letter to charge multi-million penalties seems a cheek. £9m is a LOT of junk property sales.
So £175m (maybe), less endless fees/costs, less fines, but plus a possible Alvarium (as was) settlement - it'd be interesting if it was listed. You'd fancy it at a say £100m mkt cap.
What a fiasco. |
HOME blew out its banking covenants a long time ago. I suspect that £9m is cheap compared to SW calling in administrators back in 2023.
It's frustrating because we can't sell out - even for pence on the pound - but everybody involved in this thing will get paid before we do. |
Someone's certainly made from HOME REIT - additional fees of £9m:
"The Company is pleased to report that, following the completion of sales in November, it has now made full repayment of the loans to Scottish Widows. The final repayment of £28.6m was made on 27th November 2024, comprising a £24.9m cash repayment and a net break gain of £3.7m. A further payment will be made to Scottish Widows in December in respect of the additional fees, which amount to approximately £9 million, at which point the lender will release its charge over the Company's assets." |
Yep - FSA turning up to the massacre to bayonet the wounded |
"My guess is that shareholders will ultimately get about 40% of last closing price - IIRC £300m market cap"
Sooner they do it, the lower the costs, but there's still a lot of unknowns re legal actions, FSA fines etc.
But still (& always) "10-20p", agreed. |
Fortunately they're at least now not a distressed seller |
Yep don't see any point in relisting now |
Green Street News reporting that the LBG debt will be paid of with auction sales already exchanged and the rest is being marketed for a Q1 sale at £175m My guess is that shareholders will ultimately get about 40% of last closing price - IIRC £300m market cap Unfortunately it good still be a long time before that gets distributed in full |
Thanks, & agreed. |
They're hoping to sell the rest of their properties as a bulk portfolio. They expect that substantially all properties will be sold no later than 30 June 2025. https://www.egi.co.uk/news/home-reit-preps-portfolio-sale-of-remaining-properties/I wouldn't be surprised if they didn't relist, better to just return what's left after deducting the bloated expenses bill assuming the FCA will let them. |
"The Group intends to publish Historical Accounts before the end of 2024 and the audited annual results for the year ended 31 August 2024 will follow as soon as is practicable thereafter. The Board and AEW remain committed to the restoration of trading in the Company's ordinary shares as soon as is practically possible."
GM is 5th December, perhaps 2025 before shares relist. HOME did well to sell enough to cover the Scot Widows loan (in theory: awaiting completions), so why not carry on selling? There's no sense in holding onto what they've got when the rent collection is so tiny.
Arguably two conflicting aims - one is to keep going long enough to take legal action against the crooks, which coincidentally also keeps management, AEW etc in clover. The second is to sell everything before costs eat away at what's left, and return all monies to shareholders.
If I were a shareholder, I'd want the second option. |
devastated - not decimated. |
 The costs that Home is incurring are indeed truly horrendous. In their recent wind down vote circular they quoted corporate costs (excluding the Investment Manager fee)paid in the period from 1 September 2023 to 16 August 2024 as approximately £17.1 million. 'These fees included approximately £5.0 million of legal fees, asignificant proportion of which has been incurred to defend threatened litigation from current and pastshareholders'So even without including possible FCA fines you could probably knock another £40m off the valuation taking it to £80 or 10p per share. Given the extreme discount that it would be priced at on relisting, it would maybe make better sense to just return any available capital ASAP rather than relisting.The problem with that is that they'd need to retain these funds to pay off the Harkus Parker clients in the event of the HP litigation being successful. If only there was a better target for Harkus Parkers self righteous sword of justice. One with bigger pockets than shareholders that will have already seen the value of their holdings value decimated.https://greenstreetnews.com/article/home-reit-sister-fund-takes-legal-action-against-valuer/ |
Thanks - or in property terms, just over 13 houses just for an audit :)) |
Over £2m for the audit looking at the fy22 results they released..... all the professional service companies bleeding this dry before shareholders |
Because super-dooper Knight Frank gave a nice valuation, is my guess. Everyone relying on everyone else.
Bull point for the shares - could be a large recovery from Alvarium.
Bear point, offsetting the c.15p estimate above - going to be some big fines, huge legals, and massive costs (how much is a 2 year audit costing?) to come off what's left.
That, and running costs likely not being covered by de minimus rent collection. |
I calculate that they have 829 remaining properties. So if they can sell at the previous average of £150k per property that should raise £129m or about 15p per share. The presentation on Monday should give more accurate figures. There doesn't look to be any Home properties in the next Allsop auction. However the annual report states (page 42) that the remainingproperties are expected to be sold in the period to30 June 2025. So I would expect sales will resume when they can ensure that all the critical documentation is available to ensure maximal sales proceeds. This hasn't always been the case due to Scottish Widows time constraints and AHRA didn't always pass them on.On the subject of Scottish Widows Peter Bill the property week journalist raised an interesting point on 'X' this morning when reporting the RNS 'How come they lent the money in the first place?'I should imagine there's a lot of Home investors that will be asking the same question. |
That's the stock market for you. They give you all this useful information monthly whilst the shares are suspended and as soon as it's getting close to be re-listed they stop. It really does my head in. |
It's disappointing that they've stopped the monthly updates.
Now would be a great time - with all of the debt supposedly paid of (in due course) - for an update on the NAV of what's left and how much rental income is being earned and collected...
Ideally there would be a buyer for some of the performing portfolio, but probably Allsops will be in business for awhile longer... |
Fair enough, I didn't think they'd do it but they've seemingly got there in the timescale:
"The Board is pleased to announce that following the October auctions, sufficient proceeds to fully repay the outstanding Scottish Widows loan will be realised upon completion of the outstanding sale properties. The Company therefore expects to repay the remaining loan amount, which amounted to £72.0m as at 30 September 2024, before the end of the year.
Since August 2023, the Company has completed on the sale of 1,229 properties and exchanged on a further 415 properties. The gross proceeds from properties sold and exchanged totals £243.3m, which in aggregate is in line with JLL's August 2023 and February 2024 draft valuations."
Question is: what's left? Ideally they should keep going from here, until it's all sold. |
2022 FY results have been released this morning.
2023 FY results before year-end. It looks like share trading will remain suspended until early 2025 at the earliest. Hopefully before then we might see some more progress on property sales / paying off Scottish Widows + an idea about the litigation against Alvarium. |
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