Seneca Growth Capital Vct Share Discussion Threads

[barryrog] 15/9/2004 18:41

hybrasil,
you may be right mate that the co. appeared to be strapped for cash last year.
they were in fact like myself,asset rich, cash poor,mine on a slightly smaller scale than theirs.
then you ask yourself the question. why not accept the offers on the table for swaysland of £14m instead of opting to finance its development?

[dunnie] 15/9/2004 18:35

Barryrog,
i'm not lashing out it was you who made the comment "if you want to be taken seriously on this board" don'tlets kid ourselves this is serious stuff, bb are all about opinions nothing else.I researched your postings though and found a bit of a gap between what you profess to do and what you did do.I have put underneath your posting about you buying pre the tip where you say you bought on the Wednesday before everyone else, well theres the trades for the Wednesday and it shows your a liar as there was no 20,000 trade that day.
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Honeygrove Grp
12345678910111213141516171819202122232425262728293031JanFebMarAprMayJunJulAugSepOctNovDec19971998199920002001200220032004 All trades on 25/08/04 Previous day (24/08/04)

Num. Code Price Size Type C T Bid Offer Time Buy Sell ? Buy % T.Buy T.Sell T.?
4 203LI7Z704 8.5 15000 O 7.75 9.0 16:04:13 15,000
44,117 1,000 40,000
3 303NRMZF04 8.85 15000 O 7.75 9.0 16:00:01 15,000
29,117 1,000 40,000
2 102IBGRS04 8.5 14117 O 7.75 9.0 14:25:46 14,117
14,117 1,000 40,000
1 0014PPMX04 7.75 40000 O 7.75 9.0 12:14:22 40,000
1,000 40,000
0 0014PRFZ04 7.75 1000 O 7.75 9.0 11:19:33 1,000
1,000








barryrog - 27 Aug'04 - 11:11 - 99 of 332


greengiant,
'd like to maintain a dialogue with you on here as you seem to be one of the only serious investors on the thread who has bothered to do proper research and analysis into the co.
i did in fact pick up 20,000 shares on wednesday,hence my coming on to the bb.
i am primarily an investor not a trader and i bought these on wednesday after speaking to a friend of mine who came over from Canterbury and is already an investor.i would have bought more but am reluctant to sell out of my portfolio which is doing really well.incidentally,he was not aware of the potential takeover otherwise i'd have acquired a significant slug but i will top up in the near future.
i did some initial research at the time,liked what i saw but was a bit concerned that the stock seemed very illiquid and the price was being influenced by small sells from short term 'lemmings' that was keeping the price very static.
since then ,i have taken time out to do some in depth analysis and the more i read,the more the co. looked like a potential takeover target. incredible assets but equally incredibly high gearing,although i can see the co.are actively taking steps to reduce this.i wasn't aware of the building problems identied by Derizzo but i am an investor not a house buyer.
there have been points raised on the thread about non performance which is quite true in respect of the share price but not,in my opinion the company itself.
the acquisition of Honeygrove looks like a steal to me and adopting their accounting policies,i.e only booking profits on legal completion of contract sales was bound to effect the co. in the short term.
it appears the co. is very confident of its projections for this year of 3.1 eps which,when you consider the dilutionary effect of the share placing is a significant achievement.the proposed divi of 0.6p per share is a terrific yield and is covered 9 times by forecasted profits.
without the potential takeover a fair price for the share seems nearer 15/20p looking at the assets and the future growth prospects. as i said in my earlier post, i am sure that mgt wouldn't sit round the table to discuss less than 20p.
good luck as a holder.

p.s.
edmund, tip sheets,in my opinion, do nothing more than bring a co. to your radar screen for research that hitherto you may not have considered.
unfortunately so many punters rush out and buy without proper research the share price soars and then existing shareholders sell to realise profits.the share price falls and the new buyers start to panic sell,normally at a loss.
go back and ask Shares Magazine about FEI,GBG,RTD and some of their other gems they have tipped this year.
no offence meant,i am not inferring you are one of these.
just expressing a point of view.
rgds.



(233 articles

[barryrog] 15/9/2004 18:03

DunnIE,
instead of just reacting and lashing out,take time out to go through the Recent News at the top of the thread.
in particular, take time out to read the AFXF dated 15/10/2003.
i don't profess to be an authority on the co. but i have thoroughly researched the last 2 years history.

[hybrasil] 15/9/2004 17:56

barryrog
I had a fairly good look at this company last year.
They were hamstrung by the lack of cash and badly needed the RAB injection.
Directors ended up buying property the company had not sold to try and boolster the picture. Its the old story this all depends on how much a purchaser is prepared to pay and the vendor to accept. If i remember correctly the mds son is gone from the main board and the chairman has been trying to get cash for his substantial holding- he got shares when propan took over honeygrove. I dont think you will see a great premium.

[edmondj] 15/9/2004 17:50

They have SAID they have requisite bank financing as required, at least to commence development. (Am not focusing on this share at the mo.)

[rockbottomone] 15/9/2004 17:39

Thanks for the reply's Dunnie and Barryrog. There seems to be a slight confusion over the Swaylands book value. Can either of you substantiate it?

[dunnie] 15/9/2004 16:41

Barryrog,
you say they didn't need £3m to survive, well why did they give up a third of the company for £3m, plus RAB have further rights if the warrants were excercised.It is arrogant of you to suggest that "if you want to be taken seriously you need to know a lot more about HYG". It sounds as if you bought on the back of a tip and have now become a authority on HYG.
The points i am making are valid if you would care to listen, if you think for one moment that £3m would develop the Swaylands site you are on another planet, if £3m in construction costs can yield a profit of £15/20m you are absolutely crazy, the point i'm making is that the profit is in the upsurge in the land value and may not be in taking it to the next stage, wake up and smell the coffee.
Regards

[barryrog] 15/9/2004 14:00

dunnIE,
i know you are a RAB holder,not an HYG holder, but if you want your posts on this thread to be taken seriously, you need to understand a lot more about HYG.
firstly, they did not pay £7m for swayslands.previously , this co. was known as Propan Homes. swayslands was acquired as part of the assets of Honeygrove when the co. took them over and changed their name to the Honeygrove Group.
this acquisition was a 'steal' as Honeygrove had got themselves into cash flow problems although they were a very respected Builder in the South East which is why Propan took the name as well.
subsequently,HYG dismissed all but 9 of the 62 Honeygrove staff as their policy is to sub contract constuction work.
secondly,they didn't have to raise £3m funds for their survival.these funds were acquired specifically to fully develop swaysland.at the time of the takeover,they were in fact seriously considering selling swaysland but after a detailed evaluation they turned down several offers of £14m as the potential profit on their approved plans, after development costs, was estimated to be £15/20m.
unlike you,i do not believe that RAB are in the driving seat on this potential takeover although ,as a major shareholder,they will have a significant role to play in the process.
i suspect that RAB took their original decision to invest on the basis that at 10p per share HYG were trading at a 50% discount to its real NAV.with the recent acquisitions i suspect they are still trading at a figure close to that.
the bottom line is that if the co. were to be liquidated today, the sale of its assets would significantly exceed its current capitalisation.
i for one hope that if the co. is eventually taken over,it is at a price that is nearer to its real NAV than to its current capitalisation.

[dunnie] 15/9/2004 11:08

EJ,
i just don't trust builders and their costing especially with Swaylands being listed, that can throw up all kind of problems in itself.HYG recently got stuck with unsold properties and that was at the height of the boom. I just feel they could make a fantastic profit without doing much more. The other thing i think if they had to raise £3m for their survival only recently by selling a third of the company, have they got the funds to do the re-furbishment work, on the face of it they would struggle.
Regards.
P.S. It always interests me to see building companies fleet of cars, they normally have a fleet of BMW's with private plates.

[edmondj] 15/9/2004 09:48

The nub of the matter re. Swaylands is that HYG is said to have declined two offers of £14 million (for a book profit of £7m) and two assessors have estimated gross development profit in the region of £15m-£20m. Obviously these are projections at a certain point in the housing pricing market. Although interest rates and market issues would undoubtedly affect the top end of the market, there will always be buyers seeking exclusivity.

[ukhawk] 15/9/2004 09:43

dunnIE, for all we know, HYG may also think this is the best time to sell out. It's easy to argue to argue the actual value of Swaylands but there's no doubt the total assets are worth a lot more than their book value. We wouldn't have got this far if that wasn't the case.
If, as Ed mentioned, there are more than one suitor, then this was always going to drag on ( not that this has, in takeover time, dragged on yet !)

[barryrog] 14/9/2004 18:11

hi rockbottom,
you probably haven't been reading the thread.
the fact is all the assets are booked at costs.this includes the land bank and all unfinished/unsold properties.swaysland alone is valued at £15m (book value £7m) and a conservative NAV is 20p+ per share.
with 123m shares in issue that would value the net assets at £25m.
in addition the estimated profit on a fully developed swaysland is £15/20m and funding has already been obtained for the development work.

[rockbottomone] 14/9/2004 17:23

The bottom line, is at the interims the NAV was £9.8m... And the market cap is £15m now. On this basis, I can't see an external offer being much higher than current market prices. I guess thats why RAB are dumping.

[hybrasil] 14/9/2004 16:38

Ther are 2 possibilities here
1. Rab now realise they made a mistake and are determined to try and get their money back. They have the shares and the warrants which will give them a nice uplift if the price exceeds 10p.
2 They are the buyers and are trying to massage the share price. I know hedge funds are not the most ethical in their approach to things but in the long term I would have thought that was a very short sighted approach. Clearly Honeygrove badly needed money when RAB made their injection and maybe they want to lay off this risk.

I would hazard a guess that it is option 1 but I stress thats my guess.

[edmundshaw] 14/9/2004 13:52

FYI "Sell" at 11.2p is a buy (by me) not a sell as listed; just adding...

Thanks to all here for a really interesting, informative thread!

Hard to see this share not going right in all probability, sooner or later, but enough doubt for me to stay in small and diversified.

Situation here reminds me a bit of Jarvis hotels which also went under NAV last year after nearly a year of waiting... good profit but not exactly rivetting stuff...

ATB, Edmund.

(hmm, now you'll all have to spell EJ's name right ;-))

[ukhawk] 13/9/2004 21:53

Barry, all the evidence points to you being right. It's very unlike the mm's not to shake the tree, but with RAB selling at anything above 10p they'd be shooting themselves in the foot if they dropped the price. Looks like a little collusion going on, but it does look like it's in all our best interests.

[barryrog] 13/9/2004 21:24

hawk,
i still think the share price is being very well managed.
a lot of potential punters look at streaming screens and see who else might be buying,volumes etc.they would have seen what looks like 6 consecutive days of all sells and been wary of taking the plunge without perhaps doing any detailed research.(short term traders are not renowned for having the patience to do that).
in addition,as you have said,there has been no news and people are uncomfortable with no news.

[ukhawk] 13/9/2004 20:21

Very little media interest in this "takeover bid", in fact, if Ed hadn't been a shareholder it would probably have gone unnoticed. Even the mm's don't seem to want to play ball, maybe they are better informed than us.

[edmondj] 13/9/2004 12:19

jangaman,

It's part of the vagaries of small cap share markets; otherwise equilibrium might be higher and there be no bid interest.

[dunnie] 13/9/2004 11:56

RAB have announced the sale of another 750,000 at 11.125p, nothing new in that as we already suspected so.

[jangaman] 13/9/2004 10:57

"I was told the price had fallen back because a director had tried to sell stock as part of a divorce settlement" (309 of 312)

who wants to invest in a company where a divorce settlement can effect the SP???

[edmondj] 12/9/2004 21:27

Presumably that was why the director turned down the City's placing offer for his shares!

[barryrog] 12/9/2004 21:20

someone is having a laugh here.
there are some 123m shares in issue and at 8p a share,that would equate to just under 10m.it has recently been reported that an offer for the swaysland site alone of £15m has been turned down!

[edmondj] 12/9/2004 12:17

I was told the price had fallen back because a director had tried to sell stock as part of a divorce settlement; Insinger had approached the market and been bid 8p which wasn't acceptable (in that no sale was agreed). This was before the approaches. Maybe the woman involved is (like us) now waiting to see what transpires!