Mercia Asset Management Share Discussion Threads

[robsy2] 29/11/2023 12:21

...and the sharebuy back seems to be working a treat , so far. There is just so much value here that even going from bombed out ( 25p) to lacklustre (40p ish ?) will be transformational for me and others and then you have the divis which look sustainable and growing . If , excessive pay aside, investors warm to the virtues of the business model , it might even get towards 50p. If they keep adding FUM as they have been doing and get a few more winners, it could go a lot higher still , say 60p. It is not impossible.

[columbarius] 29/11/2023 11:15

In the presentation yesterday it was announced the dividend will continue to increase. Some interesting snippets on Warwick Acoustics. The contracted OEM goes into production next year with the first car to be fitted with Warwick's disruptive audio going on sale in 2025. Importantly, they're broadening the range of models that will get the flat panel transducers. Announcements on at least two more luxury OEMs coming soon.

[robsy2] 29/11/2023 09:30

I have mixed feelings, I can see exactly what Red is saying. MERC directors take bonuses when they do deals over and above salary , pensions , free shares etc . Not good. Is there enough on the table for the rest of us? Probably,so on balance I'll stay invested.

[columbarius] 28/11/2023 11:25

Miniscule reward? That’s a matter of opinion and conviction. I bought a second home in France last year thanks largely to profit from MERC and the share price is a gift again.

[redartbmud] 28/11/2023 10:00

Dynamite wouldn't make a dent.
Business model stacked against the PI's who are just financiers for miniscule reward.

red

[mortimer7] 28/11/2023 08:21

Absolutely, seems to be very "off radar".

[kasspass] 28/11/2023 08:19

Dividends... Cash in the bank....and now share buyback...let s you wonder what else can get the share price moving.

[robsy2] 22/11/2023 17:39

Extending to 2035 provides certainty in the VCT and EIS market so is good for MERC.



VCT and EIS sunset clause extended to 2035
MicrosoftTeams-image-18.jpg
Darius McQuaid
22 November 2023



Chancellor Jeremy Hunt has extended the Venture Capital Trust (VCT) and Enterprise Investment Scheme (EIS) sunset clause to 2035 during the Autumn Statement today (22 November).

The Association of Investment Companies (AIC) chief executive Richard Stone described it as “excellent news”.

“This addresses an urgent issue as the sunset clause would have automatically ended VCT tax relief in April 2025.

“The extension to 2035 will help provide certainty to investors and businesses and enable VCTs to continue supporting UK growth companies.”

Triple Point head of retail sales Jack Rose added: “We warmly welcome the UK government’s decision to extend the VCT and EIS sunset clause, announced within the Autumn Statement today.

“This extension is a testament to the government’s commitment to nurturing the growth of young, fast-growing SMEs, which serve as the backbone of the UK economy.

“The tax incentives embedded in VCT and EIS have proven to be magnets for investors, attracting over £1bn in VCT investment for the second consecutive year, in the 2022/23 tax year.

“Simultaneously, EIS saw an impressive investment of over £2.5bn by UK taxpayers during the same period.

“These figures underscore the vital role these pieces of legislation play in providing crucial resources to young companies and the investors who believe in their potential.”

St. James’s Place (SJP) head of tax advantaged investments Luke Barnett also welcomed the news.

He said: “Not only is the announcement a recognition by government of the benefits which these schemes can bring, but it will also provide much needed certainty to investors.

“With this news, it will help to reinforce the attractiveness of the UK market for startups, and founders can continue to build new and exciting businesses with confidence.”

[columbarius] 22/11/2023 10:55

It will certainly be good for us Robsy2. Mercia has a strong relationship with the British Business Bank and our CEO is on record as being confident we will get more funds to manage on their behalf. The successful sale of nDreams was nicely timed in this respect. If the government finally gets serious about investing in regional growth, not just London and the south east, we are best placed to deliver. We also have strong links with universities. For example Oxford Prof Len Seymour was a leading light at one of our other big successes, Oxgene.

[robsy2] 21/11/2023 17:33

Government initiatives to help venture capital could be good for us . We'll see some more detail tomorrow.


"The Treasury said £250m will be committed to two successful bidders under the Long-term Investment for Technology and Science (LIFTS) initiative.

This initiative works with the industry to establish new funds to invest in science and tech companies and “provide over a billion pounds of investment from pension funds and other sources into UK science and technology companies.”

Also, a new growth fund will be created within the British Business Bank (BBB) and will access “the best investment opportunities in the UK’s most promising businesses” which has received support from both pension schemes and fund managers.

Hunt said: “Innovation is the key to our future success as a nation and its vital that we do all we can to help companies start, scale and grow in the UK.

“Tomorrow̵7;s (22 November) Autumn Statement will be a huge step towards delivering our Mansion House Reforms and unleashing the full potential of our pensions industry.”

The package also includes measures to support the UK’s venture capital industry. The new Venture Capital Fellowship scheme “will support the next generation of world-leading investors in our [UK] renowned VC funds”.

This comes as the chancellor is convening representatives from several universities and investors at University College London (UCL) East where they will endorse a new set of “best-practice policies” that are recommended in a separate review.

In 2021-22 £5.3bn was raised in investment from spin-out companies from research done at universities.

The independent review led by Oxford University vice-chancellor Irene Tracey and Cambridge Innovation Capital managing partner Andrew Williamson recommends innovation-friendly policies that universities and investors should adopt to make the UK the best place in the world to start a spin out company.

The chancellor has accepted all the recommendations and will set out his full response as part of the Autumn Statement tomorrow."

[stevenlondon3] 21/11/2023 09:48

It is encouraging that it has so far held on to yesterday's sharp gain, although it has only reversed the weakness seen in September and October.

[weatherman] 20/11/2023 13:44

Simon Thompson got the hump a few years ago, and hasn't forgiven them for raising equity that reduced the NAV per share. Maybe he'll see the light again.

[redartbmud] 20/11/2023 13:37

Cannaccord smokin' 61p Must have a gold standard stash.
Psychedelic dreams.

red

[columbarius] 20/11/2023 13:26

A boost today for Mercia company musicMagpie. Possible takeover.
"The Board of musicMagpie notes the recent speculation and confirms it is in early-stage discussions with both BT Group plc and Aurelius Group (together "the Parties") as to a possible offer to acquire the entire issued and to be issued share capital of musicMagpie."

[columbarius] 20/11/2023 13:22

Tongue in cheek right? He was a fan but threw all his toys out of the pram several years ago.

[rimau1] 20/11/2023 11:52

We should get a Simon Thompson article too, he is a fan

[columbarius] 20/11/2023 10:19

Thanks Robsy2. I think Canaccord’s positivity is entirely justified. There are strong hints their price targets will be revised upwards after the release of the interims on 28th November. There will be an Investor Meet Company presentation at 3pm on that date. Warwick Acoustics is also performing very well as mentioned earlier.

[robsy2] 20/11/2023 09:55

Glad I topped up now , though I am still well under water here.
conclusion form Cannacord thsi morning;

Valuation and recommendation We shall review our forecasts and valuation more fully at the time of the interims (28 November 2023) but note the resilience of Mercia's FUM, relative to other asset managers experiencing outflows currently. We also note that Mercia is trading at a c.52% discount to NAV. Importantly, it has only ever been at this level of discount once before, in March 2020. This was no doubt in anticipation of the fair value write-downs referenced above for that year. Subsequently, the shares gained 170% over the following 20 months. Given that we do not expect to see a repeat of those fair value write-downs, and that the business is arguably in better shape than it ever has been, due to: i) its proven ability to deliver strong realised gains; ii) better quality of earnings, due to a rapidly growing and profitable asset management business; and iii) a lot of dry powder to support existing investments, we retain our conviction BUY on the stock. In addition, the dividend yield is just over 4%. Our target price of 61p implies 177% upside.

[rimau1] 20/11/2023 09:07

I bought in on the bell this morning. Along with Augm i really like the unwarranted discount to nav backed by significant cash. Agree with sentiment here, fallen too far. Results soon and the cash should be earning a nice interest income kicker.

[columbarius] 20/11/2023 07:56

Debt free and 60% of market cap in cash. This has been well managed during three difficult years.

[weatherman] 20/11/2023 07:42

Looks like nearly another £4.5m added to NAV - stake was on the books at £25.7m, sold for over £30m. Now £60m cash, £100m mk cap - well oversold. [edited].

[columbarius] 20/11/2023 07:40

Big boost to the cash pile and further evidence that the 50% plus discount to NAV is ridiculous.

[weatherman] 20/11/2023 07:37

Sale of nDreams announced - good price overall.

[columbarius] 14/11/2023 16:26

Warwick were demonstrating their headphones and samples of car audio speakers at the Mercia agm. As you’ll know the headphones were marketed first and have given the company an excellent reputation. In-car entertainment is the big prize, although they said the headphones business was doing very well with demand exceeding supply. Amazing really when you see how expensive they are, but they’re the best you can get, aimed at music professionals and the rich.
The car speakers are wafer thin so very light. They had current speakers for comparison and the weight and electric power saving, multiplied by the number of speakers used in cars is significant, so well suited to EVs. They said the first premium EV to have their transducers installed goes into production next year. Also the manufacturer would throw in Warwick Acoustic headphones as a gift to their big spenders so a double win. Depending on how long they keep hold of their stake, I think this company alone could cover Mercia’s current enterprise value.