Manolete Partners Share Discussion Threads

[tradertrev] 18/4/2023 10:35

But riv77's explanation equally plausible

[tradertrev] 18/4/2023 10:34

Just guessing (and not intending to scaremonger) but feels like a placing of some sort coming. Could be primary issuance to reduce the debt or some pre-IPO holders' shares coming out.

[riverman77] 18/4/2023 10:34

Either the market genuinely does know something or (more likely) investors/traders have seen the recent slip and assumed (wrongly) that the market knows something, creating a downward spiral. I guess we'll find out soon, but happy to hold on to my small position.

[sallad3] 18/4/2023 10:12

Someone must know something that explains this precipitous decline.

The very limited publicly held float doesn't help at times like this.

[rmjpb] 17/4/2023 17:39

I was wondering the same thing, especially now that BUR and LIT were all up.

[sallad3] 17/4/2023 14:43

Anyone know the carrying value of the "Slaidburn 52 Ltd" claims?

MANO have just had to issue bankruptcy petitions against the 3 directors.

[riverman77] 17/4/2023 13:21

Can't see anything obvious, but down 20% in a couple of weeks. If it was a larger company I might be worried, but suspect it's just lots of small trades from retail investors, which has created a bit of negative momentum. I've taken the opportunity to top up anyway so hopefully it's nothing more serious.

[dagoberia] 17/4/2023 11:43

Does anyone know why this is falling? The last pieces of news seemed pretty promising. I guess just the usual share price movements of thinly traded companies

[maddox] 03/4/2023 09:06

With LIT and BUR starting to perform post-Covid - chalking-up some big case wins we might see a change in sentiment towards LitFin. It's been an unloved sector with plenty of derogatory commentary - however, I think perceptions are about to change.
The historic metrics look exceptionally attractive and now we're looking at evidence to validate them.

I think 2023 is going to be an interesting year.

[maddox] 03/4/2023 00:13

Hi lordofiverton,

The 14 March update stated:

5. Truck Cartel Cases

The judgments on the British Telecom and Royal Mail cases were handed down on 7 February 2023. The Company's retained competition law case value experts (Fideres Partners LLP) have accordingly updated their valuation of Manolete's 22 cases and the Board is satisfied that, subject to audit, the current carrying value in the balance sheet of £13.2m is materially correct. Further non-Manolete truck cartel case judgments are awaited, and the Company's own claims remain stayed at present.

So, bottom line is that we won't know until a settlement is negotiated.

You may wish to second-guess the expertise that MANO has employed but I haven't bothered - it doesn't substantially effect the investment case IMHO.

Regards Maddox

[lordoftiverton] 02/4/2023 22:03

I'm concerned about the carrying value of the cartel cases.In June the Manolete Presentation said "as significant progress (Trials) is now being made and that impacts all 22 cases we have made a £5.1m increase in our valuation of this category of claims"In September the presentation said "as significant progress (trials) is now been made and that impacts all claims and due to reflect the work on these claims over H1 FY 23 and the fact that all defendants have now been served with their claims we have made a £1m increase in valuation of this category of claim"They also disclose that "the carrying value at risk on the balance sheet for the cartel cases as a whole is £13.2m"My concern is that nothing has actually happened in the progress of these cases to justify these uplifts.Am I missing something?

[tradertrev] 28/3/2023 18:35

Steven Cooklin is always extremely confident about everything - just saying!

[cfro] 28/3/2023 16:11

sallad3,

I am not here to argue with you, i am merely pointing out Steven Cooklin's comments which appear to be very different from yours. All the info is out there on the cartel cases that we are allowed to know.

Maybe your assumptions will be proved to be right however SC seems confident not only on winning the cases but i get the impression that the £13.2m figure will be revised upwards (not downwards) too (Covid disruptions etc). We will have to wait and see.

[sallad3] 28/3/2023 14:59

cfro

My problem is that the Moulton case now reveals the extraordinary extent that the MANO model is mainly to provide massive amounts of money to Licensed Insolvency Practitioners and their solicitors/barristers without any external review on the payments.

The CityLink numbers just don't add up. Payment in the AIM prospectus was £115k not £125k for 100% then MANO paid more and then told us they gave up 10% when they didn't and all along it seems to have been a device to enrich EY and "pump up" the MANO asset value on listing.

That's why I have always had my doubts about the valuation of the Cartel cases when so many of the smaller IPs have written it off.

For EY to go straight from Administration only to then restore solely to assist MANO and ensure that MANO agrees to pay them (with only a little bit for the creditors) 5% of the Gross (a vast amount) by changing the deal disclosed in the prospectus doesn't now and never has really passed the smell test. Inevitably one has to wonder about the valuation then and now.

The write off of the most recent lost big case just heightens my fears. Given the basis of that case as revealed in the Court of Appeal documents I really don't see how anyone could have written up the value beyond purely speculative.

MANO exists as a "scare the pants off everyone" business - a bit like a well disgused bailiff business. Yes there is a need for that in many cases but the valuation model seems to have been rather too hyped in the past.

Still the proof of the pudding is yet to come. See you at the AGM?

[cfro] 28/3/2023 09:03

See the video i posted above at 17.42 minutes in "update on cartel cases".

Lots of information in there. I think the point is that we are not going to know the finer details until the formal announcement. There is obviously going to be lots of adjustments for added costs and/or values.

[jonwig] 27/3/2023 18:38

sallad - sorry can't help, you have a lot more command of the detail there than I have.

[sallad3] 27/3/2023 18:09

jonwig

I'm digging around in the Jon Moulton (City Link and 26+% shareholder in MANO) truck cartel numbers and wondered if you can recall any further specifics to assist in coming up with support for the valuation of (..£6k..?) per tractor etc.

The various Companies House records show that at the date of the administration there were 2,600 hired vehicles (cars, vans forklifts, tractors and trailers). Can you recall if Steve C has ever given a unit number for claims for the Moulton vehicles ?

The claims were 100% assigned to MANO for £125k and the company then dissolved.

Subsequently it had to be restored on 20.11.19 and placed in liquidation SOLELY to help MANO's cartel case (EY's words not mine).

MANO's RNS of 14 July 2020 stated that "On the [..City Link claim...] £125,000 was paid in initial consideration ... but Manolete owns a 90/10 split of the net proceeds."

That doesn't seem to be the case given EY's latest report.

MANO has actually agreed to underwriting ALL the costs of the liquidation AND the EY liquidators remuneration and expenses. EY's fees to be paid by MANO are 5% of the GROSS (yes GROSS not net) and a further minimum sum of £50k (capped at £180k) plus all costs to close the liquidation.

That's an awful lot of money for EY with the benefit to creditors capped at a maximum £600k. and only £41,821.50 on the EY time clock at £550 per hour.

It's a potentially very very big cost to MANO when the whole principal of the Moulton deal was he assigned 100% to MANO before the AIM listing and he was to be the sole remaining substantial shareholder.

The Guernsey press reported in 2022 that:
"Now he plans to keep his head down, investing his own wealth through his family office – one of his top investments is in London-listed litigation funder Manolete Partners. 'We've made a fortune on that. We own about 26 per cent which didn't cost us very much.' The company is now worth around £240m."

I'm struggling to see the realism of the £13.2m Cartel valuation in the absence of meaningful volume of vehicles nombers, and there is a loss to be reported for FY23 anyway per last RNS that relies on no Cartel writedown being necessary.

Perhaps we might get further detail in the promised April update.

Any help or AGM or other meeting recollections gratefully appreciated.

[cfro] 16/3/2023 10:03

On the subject of fair value accounting this video interview with Steve Cooklin from 4 months ago is worth watching, particularly from 19.27m in "revaluation of open cases":





What Mr Cooklin says is really interesting. The Ukraine war and likelyhood of recession was the reason why they decided to re-value the cases. (note that there is to be no recession this year now).

The deviation is 1-2% plus or minus fair value in the accounts to what is actually received. In many cases they do receive more.

[jonwig] 15/3/2023 18:46

sallad - I seem to remember they did a blanket fair value reduction in the HY results, citing general economic conditions and this single case. lesson learned?

[sallad3] 15/3/2023 17:53

jonwig

If you can make the time do listen to the Court of Appeal broadcast.

It shows that the MANO case was baesd on extrapolating a single year's numbers across the entire life of the company to come up with a more than £3m claim against the direcotrs and their families.

The evidence on display shows that it was so obviously a very very difficult case to prove that I do wonder how the Fair Value could ever come up with the £2+m that had to be written off. The MANO "scare the pants off people" model works well in open and shut cases but the courtroom always beckons where there are clear and major disputes (in this case on purely speculative and unprovable numbers).

Like all litigation funders the directors never like their underlying details exposed, so it is surprising, to me, that they even went to the Court of Appeal for reasons other than PR. A very expensive lesson.

I am surprised at the £750k costs of the appeal of what was always going to be a "significantly less than certain" (to use a neutral phrase) case to overturn what was a well reasoned judgment.

It does make me wonder what else lurks in the Fair Value cupboard.

[jonwig] 14/3/2023 17:54

RMJPD - LOL, when it's a private arrangement between Manolete and Barclays and, as the FT reported last week, HMRC had given up on trying to recover covid loans!

[rmjpb] 14/3/2023 17:03

In respect of the BBL, having been given 45 in January, 10 have agreed full settlement so far, and it's only March - this to me sounds really promising, and a business stream that did not exist pre covid when the share price was over £5....in advanced talks with another bank as well. Won't the tories want to be lauding this tomorrow in the budget that they are being tough on covid fraudsters?

[jonwig] 14/3/2023 16:30

cfro - they bank with HSBC and are looking to partner with another big bank besides Barclays. Join the dots?

EDIT: probably not - conflict of interest?

[sallad3] 14/3/2023 16:17

Interesting choice of the new valuers - Fideres Partners llp - who seem to have set up their own litigation fund according to Simmons & Simmons website.