Lionheart Share Discussion Threads

[mstrathern] 06/3/2003 00:43

If I understand the Takover Panel rules correctly the offer may not be revised after 46 days from the offer date and lapses after 60 days unless the Takeover Panel agrees to the change (I'm not sure what constitutes the 'offer date'). So I presume that the only game left for Sigma is to hope that they can get to the 75% mark that would allow them to delist the company. Even then, since they mention in the offer that they only have the cash if they get 90%, they would have to go back to the Takeover Panel as I think that this would consitute a substantive change.

So I think that we have seen off the Sigma bid; though I'm not 100% sure and therefore still nervous. The question is what next. My feeling is that we should be trying to get the major shareholders, the PRU, Judges and Handsel to push for an early winding up. If not then we should be looking to find a group amongst ourselves with the necessary >5% so that we can requisition a motion at the next AGM and bring this sorry saga to a head.

[asph] 05/3/2003 16:36

I totally support the following extract from mstrathern

"My feeling is that we should be trying to get the major shareholders, the PRU, Judges and Handsel to push for an early winding up. If not then we should be looking to find a group amongst ourselves with the necessary >5% so that we can requisition a motion at the next AGM and bring this sorry saga to a head."

[tiltonboy] 04/3/2003 11:00

Here is the relevant part of the offer document. P28 1(b):

The Offer, whether revised or not, will not(except with the consent of the Panel) be capable of becoming unconditional after midnight on 28 March 2003(or any earlier time and/or date beyond which Sigma has stated that the Offer will not be extended and in respect of which it has not withdrawn that statement) nor of it being kept open for acceptance after that time and/or date unless it has previously become unconditional, provided that Sigma reserves the right, with the permission of the Panel, to extend the Offer to later time(s) and/or date(s). end


I would be amazed if the Panel allowed any extension past 28 March, and as such I believe the offer will lapse.

Well done to all the LNH holders who have not accepted this ludicrous offer.

tiltonboy

[asph] 04/3/2003 09:56

how many more times do they have available to waste shareholders time-------this offer and procrastination is unacceptable-------the Authorities should step in now!!!!!!!and halt this charade.

[mstrathern] 03/3/2003 15:56

Bye-bye Sigma, bye-bye?

Am I wrong, or hasn't the Sigma offer now collapsed as it is past the last offer deadline without being taken up or going unconditional?

If so now for our cash BACK! And not another phony value offer.

[tiltonboy] 02/3/2003 20:36

SKYSHIP,

Good evening. Did you get my e-mail? Hopefully the next closing date will come and go without too many more acceptances.

Off topic, what did you think of the CLS results? I have managed to get their PR to persuade the company to come and give a presentation up in Brum.

tiltonboy

[skyship] 02/3/2003 19:19

fm27 - quite right to do nothing, but by doing so you don't necessarily lose, as your company's cash is still intact - less whatever Pollock continues to spend ostensibly seeking to do right by us rather than himself!

As to the iii Board, perhaps I've been unlucky, but there never appears to be any sensibly constructed comment there from any poster I've ever come across. At least on ADVFN you do find minds with whom you can debate an issue......ouch, sorry, seem to be a bit cranky this evening!

[fm27] 01/3/2003 19:40

thanks to both skyship and mstrathern for your input. I wasnt actually asking for advice on which option I should take but asking for someone to explain the consequences of each one. It now seems to me that whatever we do we lose so I have decided to hold on to my shares and do nothing.

[mstrathern] 27/2/2003 16:01

Year, I've tried to put it right. It rather p*sses me off to be offered Sigma shares by Sigma for 36p when I can buy them anywhere else for 27p! And they've been plummeting in price almost since they came to market (>40% a year for the last two years). So by the time we get them and start flooding an iliquid market they'll probably be down another 10%. I think I'll pop over to the Sigma discussions and start to explain there what's likely to happen to the price if the bid goes through!

[eddie max] 24/2/2003 19:33

I Hope MWM is right !

I almost forgotten I had this dog of a share !!

[skyship] 24/2/2003 19:21

ie - do nothing...& wait....you lose nothing that way!

[mstrathern] 24/2/2003 15:13

fm27 - dont come to a board like this for advice on what to do. There are often parties who will give you advice in their own interest. Having said that here is what, I with a small holding in Lionheart, think. I hold my shares through iDealing and as a consequence do not have a full copy of the offer. If I make any mistakes can someone correct them.

I take it thet the four options that you were talking about are as follows:

1 Reject the offer, this is the same as 2
2 Do nothing. This is the same as rejecting the offer as there is no formal way of rejecting it, only a formal method of accepting it
3 Accept the offer of 107p and opt for 1.48 Sigma shares.
4 Accept the offer of 107p but opt for more cash rather than Sigma shares.


I'll deal with them in reverse order. 3 & 4 will only happen if the offer goes unconditional and there seems to be some doubt about this. The general reading seems to be that Sigma does not have the cash for the bid and is going to borrow it from bankers, and that the bankers will only lend if acceptances are >90%. The reason for this is that it is only when the acceptances are >90% that the remaining shares can be forcibly bought. Below 90% and there is a mess if the acceptances are taken up, the kind of thing that bankers don't want to get involved in. Option 4, which on the face of it looks attractive as it would essentially appear to pay back all of the cash is in fact not quite what it might appear. If everyone opted for this option then there would not be enough money to go round. In those circumstances those who opted for this would get a proportion of their share sale as 3 rather than 4. If you look at the price of Sigma shares since the offer was made you can see that at no time was it advantageous to take option 3 rather than 4 so we must presume that the majority of acceptances have been for 4 rather than 3. We don't know how 4 is funded, but if it had been fully, or even fairly fully funded this would in all likelyhood have been spelt out in the offer document. Under these circumstances option 4, which appears to give fair value for the company, is a mirage since what will actually happen will very much closer to 3, which does not at present, nor IMHO would ever, give a fair value for the company.

As I said options 1 & 2 are the same so we come down to a choice between 1 & 3. Now the rules are that if there are >90% accceptances and the offer becomes a mandatory sale no one can be disavantaged with regard to anyone else. I'm not sure whether this would mean that there would be a choice between 3 & 4, but as I have already said I think that that choice is a mirage in any case. So the choice is in some sense no choice. If you accept the offer and it is taken up then, under present circumstances, the BEST you will get is less
than the fair value of the company. If on the other hand you and sufficient number other shareholders refuse the offer and it fails then the shareholders can force the realisation of the full value and its return to the shareholders over a fairly short period of time. As of now the stated non acceptances at the present time are over 40%. Also there have been two recent aquistions of substantial shareholdings by owners whose postion appears to be that they will not accept the offer under any circumstances.

As I'm sure you can gather I am against accepting the offer and for some other form of action that would release full shareholder value, probably voluntary winding up. The offer as it presently stands is to buy a value of ~161p in cash for 107p in cash and ~ 36p of paper (total ~143p), with some very real doubts as to whether the paper component of the offer would hold its value if a takeover did happen and a lot of of the new paper came onto the market.

Hope that was helpful

[fm27] 23/2/2003 20:15

Thanks for your response to my request, it is most apreciated. Unfortunatley I still have no idea what to do for the best

[skyship] 22/2/2003 20:23

OBR - "Bucket-shop" Bridgewell were the advisors, but, as stated in the Offer document, they did so having "....taken into account the commercial assessments of the Board of Lionheart". In what has to be the second most extraordinary statement in that Offer document (the first being Pollock's deliberately misleading view on the timescale of a voluntary liquidation) The Independent Director (Pollock) says he was advised by Bridgewell; and Bridgewell say they were advised by Pollock.

What is even more depressing is that the AIM Administration Team at the LSE, the Takeover Panel and the DTI - ALL of these regulatory bodies failed to find fault with either aspect. Incredible.

What they, and all of us, need to be aware of is that Pollock is that breed of fat cat director who awards himself share options in the Company he is running; and when the shares bomb and the time runs out - he simply extends the option for a few more years in the hope that a capital gain awaits at some time in the future. All this whilst drawing a six figure salary from the loss-making Company. WHAT AM I ON ABOUT? Well, the chairman's statement in the newly published accounts for LPA Group reveal all - Click onto the 29th January press release on the LPA thread.

[fm27] 22/2/2003 19:16

Could anyone explain the consequences of each of the four options that we have been faced with I find the situation very confusing and do not know which option would be of greatest benefit to myself. What happens if I do nothing???

[mstrathern] 20/2/2003 16:01

you may well be right but from what I have gathered it is very difficult to actually realise some if any of a tax loss in this situation.As I remember it the profits that the loss are offset against have to be within the same industrial sector that the loses where made, that there has to be some 'continuity of busuiness', and the time constraints are quite sever. But perhaps someone who really knows about this could enlighten us.

[asph] 20/2/2003 13:38

in the right hands the capital losses £25 million could be worth £6/7 million ??
Lionheart nanme and quoptation worth ££££ ????

[mstrathern] 20/2/2003 13:01

Old Boy - Let's hope he is right. I have in my mind, either from this board or one of the others, that the PRU can probably dump the Sigma offer if there is a bid 10% higher than Sigmas. Unfortunately I don't know if this is 10% higher than the value of the offer at the time it was made, i.e. 161p, or its present value, i.e. ~147p.

If a bid is going to come, and presuably MW has talked to someone who has mentioned the possibility, and it is going to be at 165p then I would have thought it would be from Handsel or Judges Capital who have been recent major buyers. Also since, at 165p, it would value the company 4p above its only tangible asset, the cash it holds, then the bidder would have to be able to use at least one of the two other assets of the company has, its tax loss position, or its quotation.

[old boy returns] 20/2/2003 11:23

Mark Watson-Mitchell seems to be following LNT saga and gave the following view:

Mark Watson-Mitchell - 20 Feb'03 - 11:16 - 103 of 103

Of the smaller caps today I reckon that Lionheart will be bid for at 165p value within one month.