Majedie Investments Share Discussion Threads

[andycapp1] 01/4/2022 07:49

That’s helpful thanks. Barlow and Board actually need to produce a solid investment strategy that preserves, say, 2/3rds of divi (doable) and which is sufficiently investable that it closes the discount to NAV. I agree is a combination of bad timing and to some extent luck but the execution of the investment strategy, ex MAM, over ten years has been very poor. They now have insufficient assets to sustain the income and grow.

[topvest] 31/3/2022 15:59

Not really. They have made some poor moves unfortunately. Think they have also been a tad unlucky. I suppose long-term Majedie Asset Management was a good investment, but they sold out too late and at least half the value from the top has gone along with their primary source of income!

[spectoacc] 31/3/2022 13:48

You trust them to get it right @topvest? ;)

[topvest] 31/3/2022 13:40

3 year lock staggered lock-up so at least Majedie can wait and see how things go over the next 1, 2 and 3 years.

[topvest] 31/3/2022 13:39

"£80 million satisfied through the issue of 3,683,241 new Ordinary
Shares to Majedie Shareholders at Completion ("Initial Consideration Shares")"

"The Initial Consideration Shares, Excess NAV Shares and Conditional
Consideration Shares are to be issued at a price of 2,172p per Ordinary Share,
being the 30-day average closing price to 3 December 2021.


The new Ordinary Shares issued to Majedie Shareholders will be subject to a
staggered three year lock up commencing from the date of issue (one third
released at one year, two years and three years after issuance), subject to
certain customary exemptions. The aggregate of the Initial Consideration
Shares, Excess NAV Shares and Conditional Consideration Shares represent
approximately 6.80 per cent. of the share capital of Liontrust, as enlarged by
the Proposed Acquisition, and assuming no subsequent dilutive share issues
(e.g. pursuant to the exercise of share options)."

£12.82/£21.72 * £80m = £47m

So the consideration price has reduced by £33m.

[andycapp1] 31/3/2022 10:10

Yes that’s right. I guess I’m not so fussed about the MAM sale because I think the business is struggling but the deal should have been struck for x£ of value at deal close not for £x of value in Liontrust shares at SPA signing? I’d add is that really the case? Surely it’s £x of EV at deal close in Liontrust shares plus cash at that point?? Surely?

[orinocor] 29/3/2022 20:17

Jeezus I couldn't work out they the daily nav performance of this was so bad since the start of the year. It has to be the liontrust shares

[topvest] 29/3/2022 18:26

This is a disastrously timed deal for Majedie. Swapping a value investor for a growth investor (in paper) when Majedie was valued at a 5 year low and Liontrust at a 5 year high. Why did they not fix a cash price?

hxxps://citywire.com/funds-insider/news/majedie-takeover-price-cut-by-50m-as-liontrust-shares-tumble/a2383681?re=95622&ea=395215&utm_source=BulkEmail_FundsInsider+Afternoon&utm_medium=BulkEmail_FundsInsider+Afternoon&utm_campaign=BulkEmail_FundsInsider+Afternoon

Let's hope they don't sell the Liontrust shares and make things worse! Liontrust is a good business (but much better value at £13 than nearly £25).

You would have thought that value investors would have known better than fall for this one!

[andycapp1] 16/2/2022 16:20

I think that is right save for the family is doing abysmally. Whether they know it, understand or frankly care I know not. It’d be the non execs role to redirect things on behalf of us lot!

[spectoacc] 16/2/2022 16:10

I fear all the evidence is that the status quo suits them.

[andycapp1] 16/2/2022 16:09

No the family owns over 50% of the shares. I suspect however they (and non exec Board) must be growing weary of the poor performance, high fees and lack of imagination in running and operating the Trust. I suspect pressure needs to come internally and not from the minority shareholders. The Trust is too small, the fees too high, and it has no USP. What is it?? Witness the ridiculous share buy backs or lack of! The odd 2000/4000 here and there. With sellers and a 21% discount they should be hoovering them up.

[cynicalsteve] 16/2/2022 13:25

Liontrust could merge the underlying MAM funds with their own, anything more radical would need to be done by the board with shareholder approval.

[makinbuks] 16/2/2022 11:03

The article suggests if he doesn’t fix it someone may come in and do it for him. Is that feasible?

[andycapp1] 16/2/2022 07:59

Yup confirms what we all know, dire performance and excessive fees. The dividend will be cut, there isn’t enough capital to maintain it that unless they become wholly or substantially UK and cut the fees. They need >4% yield to generate the dividend and then, of course, they compromise capital return even more if that’s possible! It needs a total rethink. I’m just not sure Barlow has the imagination and I think he’s too entrenched in the family holding to know what to do. And he’s collecting his salary, which is over 0.1% of assets, for presiding over this mess. Its v dispiriting really.

[spectoacc] 15/2/2022 13:34

Nothing we don't know, but at least some press:

[orinocor] 03/2/2022 13:51

That's better. Nav up to 261.85p. I'm in for more under 210p

[andycapp1] 31/1/2022 17:41

I think that’s the problem. He is just not a very good money/fund manager. The degearing point really annoyed me but the subsequent NAV has been terrible. It was best part of 286p when mkt was pretty much same level as now. Now it’s 260p so 10% lower. Admittedly 7p of that is divi but I reckon the NAV is still under the mkt by 5-7% over two months which is terrible given it’s supposed asset allocation. And that’s the trouble I suspect. Far too cautious and serial underperformed. I’m going to hold to see what “new post MAM” strategy is. But think it’ll invariably mean a div cut. If I was confident the quid pro quo was better asset performance I might hang on. But not convinced it will?

[makinbuks] 29/1/2022 15:34

Yes your degrearing point is well made. Timing appalling and complete lack of judgement

[andycapp1] 28/1/2022 13:32

I don’t know what Barlow is doing? Degearing at bottom and seemingly far too cautious. The NAV performance since Nov is desperately poor. Esp given it’s decent UK value exposure.

[orinocor] 28/1/2022 12:54

This is the dog's dog.

[andycapp1] 27/1/2022 15:31

Lord this is an utter dog. Its NAV performance recently is woeful given it’s got decent Uk exposure.

[andycapp1] 25/1/2022 07:51

Also wonder if the mkt is peripherally worried about the MAM sale? For me whilst it’s a somewhat disappointing price it could get worse if mkts are poor.

[andycapp1] 24/1/2022 23:36

Even before today the recent NAV performance has been dire. It’s v perplexing as the UK portfolio mirrors pretty much Edin, which has been ok NAV wise. Overall it’s been a poor ten years. Too much focus on the div and not enough NAV growth. Now the div must be under pressure.

[spectoacc] 24/1/2022 20:31

Thanks @orinocor.