Mccoll's Retail Share Discussion Threads

[monte1] 10/5/2022 16:16

There will be hundreds of other smaller unsecured creditors on an estate that size.

[loganair] 10/5/2022 16:13

The biggest unsecured creditor was Morrison's unpaid for stock in the shops.

[monte1] 10/5/2022 16:10

#6147

Not sure where you get that all debt will be paid off as a result of the Morrisons bid. This only applies to the major secured creditors such as the banks etc. It is widely reported that unsecured creditors will lose out.

[loganair] 10/5/2022 16:09

McColl's shares may be still listed, however all the shops, stock, debt, pensions etc have been bought by Morrison's, basically means the shares are just of a shell company with no assets and no income.

[kinwah] 10/5/2022 16:08

I think people are missing a vital piece of information. In my London edition Times today, the last para reads "The secured lenders and preferential creditors will be repaid in full. A source said it was too early to determine the level of returns to unsecured creditors but described it as "meaningful" as Morrisons was by far the largest creditor". To me that suggests that Morrisons might have to take a hit of possibly £65m if say unsecured creditors only get half of what they are owed. That is why the high value low margin products such as scratchcards were stripped from the shops - probably under a retention of title clause in the supply contract. Thanks Shane for the info. There is likely to be a shortfall to unsecured creditors in the tens of millions so I think liquidation will follow fairly quickly. What beggars belief is how Morrisons funded MCLS to the extent of £120k per store with no security. As Shane suggests there will be many job losses as Morrisons focus on those stores it can operate profitably.

[pwhite73] 10/5/2022 15:46

RST2020 - "So there has been no change in MCLS ownership. Surely that is why the listing remains (until liquidation occurs)."

That's correct. So if Morrisons have taken on all the debt then the listed Plc with its owning shareholders is debt free. So following on from that why would the Plc be liquidated when it has no creditors?. The normal course of action for listed companies that have sold all their assets and are debt free is to become what is termed a shell or cash shell. The shell then has 12 months to reverse a business into it or the listing is cancelled. There is no reason why the Plc cannot come out of administration and remain listed as a cash shell.

Granted this normally does not happen because the buyer of the pre-pack does not clear all the debt but only part of it so the Plc is liquidated because with its assets stripped it cannot service the remaining debt.

This is not the case with McColl's Plc, all the debt is cleared. Do you see the problem?

[rookieswingtrader2020] 10/5/2022 15:22

Morrison's being a creditor of MCLS's simply meant that Morrison's had an interest in someone (anyone) buying MCLS's assets (so that MCLS could raise cash with which creditors, including Morrison's, could be paid off to the extent possible).Morrison's could have let EG be the assets-buyer if they wanted. There was no need for Morrison's to insist on using their own cash to be the assets-buyer. They clearly did so for reasons unconnected with the mere fact that they happen to be an MCLS creditor.In fact, I think I may have even read that as part of their offer, Morrison's was willing to waive some or all of the debt that MCLS owed Morrison's.

[rookieswingtrader2020] 10/5/2022 15:12

Surely the reason that MCLS is still listed is because the shareholders still own it. CD&R bought Morrison's from Morrison's shareholders. That removed Morrison's listing. But Morrison's didn't buy MCLS; they merely bought MCLS' assets. So there has been no change in MCLS ownership. Surely that is why the listing remains (until liquidation occurs).

[mrblueface] 10/5/2022 14:34

Mugs lost everything here PMSL Shares are worthless LOL worth zero 0p. A reusable carry bag is worth more PMSL

[pwhite73] 10/5/2022 14:22

That sounds more plausible but it doesn't change the fact that Morrison's was essentially rescuing itself. Morrison's own listing was cancelled last year when it was taken out by private equity company Clayton Dubilier & Rice. McColl's still has listing. Food for thought?

[spotdog40] 10/5/2022 13:56

I think the £130m is in stock ie stuff they've bought from the Morrisons as wholesaler, not shares

[pwhite73] 10/5/2022 13:47

RST2020 - "The company’s newly-acquired cash (from those asset sales) will therefore be used (to the extent possible) to pay off creditors."

Its not as straight forward as that because Morrisons are the largest creditor and also a stock holder previously valued at £130 million if The Times is correct. So paying off the so called creditors is not an act of charity for it is effectively paying off itself. With a stock holding previously worth £130 million where is the financial incentive to write it down to zero? its almost as much as the debt.

Morrison's could still use McColl's listing to tap the markets for funding now that it is on a more secure footing. Like you this is speculation on my part but there is a twist to this administration that did not exist in the previous household name high street retailers that went under. Its not over yet.

[rookieswingtrader2020] 10/5/2022 13:12

PWhite73 - You say you haven't read anything about a de-listing and that you wouldn't give up hope just yet. But my understanding is that Morrison's bought the company assets, not the company itself. The company's newly-acquired cash (from those asset sales) will therefore be used (to the extent possible) to pay off creditors. The company will surely therefore ultimately be liquidated as an "empty" company (with no assets and no liabilities - at least no liabilities which it is expected or able to address). The company's liquidation will cause the shares simply to cease to exist (and the listing automatically to fall away, perhaps even without any de-listing paperwork ever needed, I speculate).

[mrblueface] 10/5/2022 12:54

You lot have LOST EVERYTHING PMSL

[mrblueface] 10/5/2022 12:54

The inch high private investors GAMBLERS need to go back to the 90s and buy a brick Nokia phone, NO INTERNET just calls and txts to overcome the compulsive gambling urges on the markets. Open up a post office account and put pocket money into it each week. They are not cut out for picking winners PMSL. Just think what they could have bought there children instead of gambling in this ? Totally shameful how do they look there children in the eye ? These types of gamblers would sell there childrens toys to cash converters for a fix PMSL

[barnes4] 10/5/2022 12:29

The inch high private I’s need to let family and friends know that they are compulsive addicted gamblers pure and simple
Some can’t even leave their screens to make themselves a drink that is the depressing thing

[mrblueface] 10/5/2022 12:05

Shame they did not realise sooner PMSL. JakNife has given very sound advice on the outcome before suspended but the gamblers did not listen LOL

[vaston] 10/5/2022 10:51

Yeah mr blue we all realise that.

[mrblueface] 10/5/2022 10:44

Wrong Shareholders get F - ALL PMSL they lose everything PMSL

[pwhite73] 10/5/2022 10:23

diku - "wider shareholders hung up high and dry?"

I would'nt give up hope just yet. Morrisons had stock invested in McColl's to the tune of £130 million according to The Times yesterday. I haven't read anything yet about a delisting.

"PwC was formally appointed as administrators on Monday and sold the business as part of a pre-pack administration, a fast-track insolvency process. Morrisons, McColl’s largest supplier and creditor, had an exposure of about £130 million to the company it has bought, mostly in stock."

[diku] 10/5/2022 09:32

And what do the BOD get?...a sweetener...or a bag of chocolates...wider shareholders hung up high and dry?...what exactly do wider shareholders own?...the company or the moving mechanism called the share price only?... and they are only there for the begging bowl aka Placing/RI?...

[hillock1] 10/5/2022 09:20

I don't have any position..but according to the news, buyer saves the stores and staffs and the creditors, and the shareholders likely get wiped out....if so, will MCLS remain a separated listed company?

[apfindley] 10/5/2022 08:13

Where is Global?He seems to have disappeared.Oh dear oh dear.