Kape Technologies Share Discussion Threads

[wilske] 21/3/2023 14:16

Read through the offer document. In Summary the Independent Directors beleive the offer does not reflect the full value of the company. However, they also caution that if Unikmind gets the 75% for the delisting then minority shareholders may find it difficult to realise their investment. . Also cautions that as Kape is incorporated in the IoM, Unikmind are not bound to offer the same price to those minority shareholders that they can squeeze out once they reach 90%, if they manage to get there.

To me, the next critical point is the vote to delist. Unikmind will try to force that through and then use the delisting to frighten smaller minority shareholders to cave in and accept the derisory offer. I dont think they will increase their offer until that vote is held. Last time I checked I dont think they have the votes so we have to all stand firm for the vote.

[death by donut] 21/3/2023 13:52

Well with my limited knowledge it reads like , dig deeper Sagi .DbD

[elbrus55] 21/3/2023 13:31

It has been out since yesterday, just difficult to find.https://investors.kape.com/sites/kape/files/2023-03/pdfs/response-document.pdf

[suetballs] 21/3/2023 13:30

Looks like there could be a bit of disagreement on the content of the Response Document!
High noon has come and gone.
Surely we'll get it today.
Suet

[wynmck] 21/3/2023 12:23

no-can't find it-was supposed to be posted by 12 noon

[adamb1978] 21/3/2023 12:04

Anyone spotted the response doc?

[adamb1978] 21/3/2023 11:34

Company will be more or less debt free by the end of the year. Means that they could debt finance a relatively meaningful acquisition (say $500m acquisition) value without using further equity

They need to solve the Sagi problem though, assuming his offer fails

[adamb1978] 21/3/2023 09:37

So Sagi's offer was a PE < 7 based on adjusted EPS?!?

[crosswires] 21/3/2023 08:54

Seems nothing will drive the share price forward now until the bid has been turned down, who would buy much higher than the offer price until the bid has failed?

[slogsweep] 21/3/2023 08:50

I'd be tempted to buy more but already have a sizable holding and had my fingers burned to often lately buying 'bargains' so sitting on fence like everyone else it seems.

[blackfinance] 21/3/2023 08:23

Slogsweep.....indeed, so what now for Kape ?????

[igoe104] 21/3/2023 08:23

No wonder Sagi wanted to get this takeover done and dusted before results came out..🤔

Hes certainly trying his best to pull the wool over our eyes...

[slogsweep] 21/3/2023 08:15

result out 15 mins in to trading and hardly any trades - odd

[se81] 21/3/2023 07:50

18.9% organic growth, 86.8% recurring revenues- impressive as always

[ifthecapfits] 21/3/2023 07:13

A stonking set of results.

[suetballs] 21/3/2023 07:12

Looking forward to reading the Response Document.
Suet

[suetballs] 21/3/2023 07:09

Well given the 2022 excellent results and future prospects the current offer is derisory.
Suet

[adamb1978] 20/3/2023 22:06

Another thought ahead of tomorrow: will be interesting to see what the management say about capital returns, both as part of the defence against Sagi and more generally.

Leverage was <1x EBITDA at the end of 2022 and this business should be pretty darn cash generative going forwards. T

They could easily return north of 5% p.a. (whether via dividend or buy back) and leave themselves with surplus cashflow for investing in new growth or other things. They don't really need to de-lever further but even with this capital return they could de-lever more

[adamb1978] 20/3/2023 17:33

elbrus

Taking your points in turn:

- "Why are you so sure that unikmind's offer will fail?"

The next 3 largest shareholders after U together account for c.18% of the register. Those parties aren't supporting the U offer given that, if they were, U would have announced it. From there, the maths is very difficult for U to get to the 75% to delist. Smaller institutions will likely take the same/similar view to Slater and most private investors from what I've read are against this too. Its hard to see how Unikmind get to 75%

- "Why do you think an offer of 285p on the table would somehow prevent KAPE from pursuing any acquisition?"

I'm not sure who said that it would however the difficulty for them would be the Frustrating Action rules in the takeover code. They'd need to seek consent from the Panel to make an acquisition

- "Why would KAPE want to pursue an acquisition to dilute Unikmind's holding?

If I was management and the largest shareholder wanted to take the company on the cheap (and we know taht is the Board and management's view given previous announcements), then I would probably want to reduce U's influence. Obviously they're not going to do a daft acquisition just to dilute U, but a deal which diluted them would be a plus

- "How would it dilute them anyway as won't unikmind be given non-dilution rights?"

U dont have anti-dilution rights any more than you or I do. They have the same class of share

- "Won't management judge any acquisition on economic strategic reasons as usual? (Especially as they would presumably need Unikmind's support to proceed with any substantial acquisition.)"

Clearly would be judged on financial effects. re U's support for a deal - as Kape is listed on AIM rather than the main market, requirements for shareholder support are lower as the class tests arent the same. The restrictions would more come from things which required a shareholder resolution under the companies act


Adam

[elbrus55] 20/3/2023 15:17

There's a lot of unjustified opinions in these recent messages. Consider:Why are you so sure that unikmind's offer will fail?Why do you think an offer of 285p on the table would somehow prevent KAPE from pursuing any acquisition?Why would KAPE want to pursue an acquisition to dilute Unikmind's holding? How would it dilute them anyway as won't unikmind be given non-dilution rights? Won't management judge any acquisition on economic strategic reasons as usual? (Especially as they would presumably need Unikmind's support to proceed with any substantial acquisition.)Maybe, we'll learn something tomorrow.

[suetballs] 20/3/2023 13:26

Ok thanks.
Suet

[adamb1978] 20/3/2023 13:19

Yes, saw it'll be tomorrow, which makes sense given the results tomorrow too. Looking forward to see how they position the valuation of the business

Going to be interesting to see how this plays out. Offer from Unikmind won't succeed but perhaps they block other deals

Perhaps KAPE would look to do more equity-financed M&A and therefore dilute Sagi? e.g. acquire a company 50% of KAPE's size with equity, and thereby dilute his holding by 1/3?

[death by donut] 20/3/2023 13:05

Think I saw on Twitter it'll be out tomorrow?DbD

[suetballs] 20/3/2023 12:57

Anyone seen the response document?
Suet