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| Share Name | Share Symbol | Market | Stock Type |
|---|---|---|---|
| K3 Capital Group Plc | K3C | London | Ordinary Share |
| Price Change | Price Change % | Share Price | Last Trade
|
|
|---|---|---|---|---|
| 0.00 | 0.00% | 349.00 | 00:00:00 |
| Open Price | Low Price | High Price | Close Price | Previous Close |
|---|---|---|---|---|
| 349.00 | 349.00 |
| Top Posts |
|---|
Posted at 15/12/2022 22:52 by texas_caddy Thanks davidosh - not entirely clear (to me) from the below on the announcement. Fair to say they are likely only to honour those committed to, and anything after (the “normal” schedule of them) may be stopped? Text from announcement:19 Dividends If any dividend is paid or becomes payable in respect of K3 Shares on or after the date of this Announcement and prior to the Effective Date, Bidco has the right to reduce the consideration payable by it pursuant to the Acquisition by an amount up to the aggregate amount of such dividend or distribution (excluding any associated tax credit). |
Posted at 12/12/2022 21:36 by adipsia1 I think that there is another reason why FRP are rated more highly than K3C and I've only just come across it after reading FRP's listing documents on their IPO. It is to do with shareholding.In the case of K3C - based upon Sharepad data - the K3C BOARD own approx. 25% of the share capital and the top 3 institutional investors only approx. 23%. In the case of FRP - based upon Sharepad data combined with a quick look through their listing document from a couple of years back - the joint major shareholder of the business alongside an institutional investor - is the company's Employee Benefit Trust, which appears to consist of nil-cost share options GIVEN to staff at the time of flotation, amounting to 7.5%. The board own approx. 6%... a significant stake, but clearly their skew is towards placing trust and rewarding their staff before themselves. I could be totally wrong and stand to be corrected, but from an institutional perspective I think I'd be far more inclined to trust a business that has endeavoured to keep all of its employees committed and onside (FRP), rather than one whose majority shareholding is totally in the control of its board. That in itself could warrant the forward PE discrepancy and explain recent K3C actions. |
Posted at 11/12/2022 08:56 by tole https://masterinvest |
Posted at 09/12/2022 12:03 by tizo100 K3 Capital Group (LON:K3C) – Bid Approach Could Spark CountersThis business sales and advisory group is in advanced discussions with Sun Capital Partners concerning a possible 350p a share cash offer from the US group. The news yesterday afternoon saw K3C’s shares rising 12% to close around 338p. Although still in the throes of hammering out the details, I wonder whether the market’s dealers are indicating a certain caution by marking the shares up by just 15p on the overnight price? K3C is currently valued at £248m, while its shares in the summer peaked out at 370p which then put a capitalisation of £272m on the business sales, recovery, corporate finance and restructuring experts. There have been other parties expressing an interest in talking takeover with K3C – perhaps that is why the market is being reticent in spooking the value just yet. Holders should sit very tight and await the outcome, which could take weeks well into 2023 to come to fruition. |
Posted at 09/12/2022 07:38 by shanklin RivaldoSnap, only re entered K3C in mid October and early November so a great quick result. But do think the BOD are taking the p#£s with their lowball offer. Happy to hang in here and see if there are any other interested parties. I hadn’t realised K3C had put itself up for sale, so perhaps other potential buyers might also not have been alert to this |
Posted at 08/12/2022 12:37 by adipsia1 The whole UK accountancy market is in a state of flux with Big 4 firms splitting off their non-audit, transactional service lines (restructuring and corporate finance (M&A) which are they key areas that FRP and K3C operate in. Deloitte have separated their restructuring business into Teneo and KPMG have done similarly with Interpath. Teneo and Interpath will tend to pick up much larger international restructuring cases than either FRP or K3C could currently handle.Other key operators in the UK include a number of American restructuring specialists like Alvarez & Marsal and Kroll. Kroll probably being closer to FRP in terms of their restructuring market. Some kind of a merger between K3C and FRP would be an interesting possibility. It would certainly create a dominate the UK market. Aside from that I would imagine an American PE fund would be the most likely candidate for such an acquisition. |
Posted at 08/12/2022 11:39 by 74tom Thanks for the additional context adipsia1. Really helpful to know the evolution profile of FRP vs K3C, based on what you've said there appears to be no fundamental reason for the valuation discrepancy between the two companies. Also makes sense re. BEG, their gross margin for last FY was 43% vs the 65% achieved by K3C which is materially lower & reason in itself for a lower rating.Fingers crossed your conviction gets rewarded Ken, a substantial re-rating would certainly make sense! |
Posted at 08/12/2022 10:44 by adipsia1 Excellent summary. Totally correct with comparisons between K3C, FRP and BEG. K3C are much closer to FRP although the K3C restructuring division does not attract as many larger cases. FRP also has an M&A element to its business but this has mainly been growing as the result of acquisition rather than organically. The fundamental difference between K3C and FRP is that K3C have evolved from a business sales background with bolt-ons in restructuring and tax advisory, whereas FRP come from a restructuring background with bolt-ons in business sales.They appear to be on convergent paths, business-wise. BEG are still fundamentally high-volume/low-valu |
Posted at 08/12/2022 10:04 by 74tom First up fair play to Shore Capital for highlighting the opportunity here and setting a positive but realistic share price target of 410p.To my knowledge there are 3 small to mid cap professional services / corporate advisory companies listed on LSE; FRP Advisory Begbies Traynor K3 Capital Looking at their financial metrics, pre tax profits for 2023 are forecast as being: K3C: £20.5m FRP: £24.1M BEG: £20.3m - Forward PE for 2023 (based on Sharepad data) K3C: 13.5 FRP: 21.2 BEG: 14.5 - Balance sheets are all similar with the three companies having net cash at the end of their last financial year of: K3C: £11.5M FRP: £18.1M BEG: £4.7M - Dividend Yield is currently 4% for K3C, 2.5% for FRP and 2.4% for BEG. To my knowledge, Begbies are a specialist corporate restructurer with less diversification / growth potential than K3C. I definitely think it's fair to say that K3C is more similar to FRP than BEG. At 410p K3C would be trading at 18.4x 2023 forecast earnings, so still around 15% below the current FRP valuation, this looks more than fair based on the metrics compared above. It's also anomalous that both FRP and BEG are trading at all time highs whereas K3C sits some 25% below it's mid 2021 level despite performing extremely well in that time period and benefitting from the same market tailwinds as those two. My suspicion is K3C have been under the radar of the wider market and are currently mispriced by between 25-50%, the dividend yield variance also suggests this, at a 2.5% yield it would trade at 460p (more in line with the YTD share price performance of FRP & BEG). Certainly risk vs reward looks excellent here ahead of next weeks trading update, we already know that Q1 delivered revenue in excess of £20m which on a run rate basis would mean they are trading ahead of expectations vs the £79.5m forecast... |
Posted at 20/7/2022 08:20 by robsy2 The stats quoted in the Refinitiv report say that K3C have closed 34 less deals in H1 2022 ,than in H1 2021,indicating a 19% fall in deals done. The report indicates that the average number of deals done has dropped just 10%, so by comparison so K3C would appear to have performed badly . So far so bad. The value of deals done in H12022 was 36m USD, there are no comparative figures for H12021.Let's contrast this info with the info coming out from K3C in their trading update of 23.06.22 regarding likely outcomes for the full year to 31.05.22. Here they said the business sales division was +34% over the previous year, with turnover of 21.5m GBP ( FY 21- 16m GBP ). If we look at the half year figures for K3C for the 6 months to 30.11.21 they show the following; M&A: Revenue +66% y/y to £9.8m. EBITDA +72% to £5.0m. Organic growth within existing brands was strong (i.e. excluding the contribution from Knight Corp. Finance), delivering a 53% increase in revenue, and a 52% increase in EBITDA. This shows that while H2 growth was more muted, H2 sales accelerated again, so that does not really tie in with the stats quoted from Refinitiv , so maybe their stats are not accurate or sales really fell off a cliff in June 22, the only month that is not covered by K3C’s official (and I imagine accurate data), OR , the deal sizes were larger , so while the number of deals was sharply down the deal size was much higher. We don’t have any stats on that . I can’t explain the difference but it would appear that while Refinitiv say that business sales growth has slowed considerably during the period 01.01.22 to 30.06.22,K3C says they “remain confident of growth across all divisions in FY23”. I do know that K3C and brokers forecast on the conservative side with the business sales division because there is low visibility on when deals will close. Alos worth noting that while business sales was 100% of the business back in 2019 and is now just a third of the business, so K3C is now much less dependent on business sales. With regard to forecasts, Cannacord have a forecast of business sales in FY 23 of just 21m GBP,which is less than the 21.5m achieved during FY 22.This looks quite conservative when you consider that K3C grew the business sales division turnover by a compound rate of 17% a year, during the covid affected lockdown period from 01.06.16 to 31.05.22. |
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