Ncc Share Discussion Threads

[mazarin] 26/11/2015 10:37

Update for Sharw and Boadica, thanks for your interest. After much wrangling and intervention by Ombudsman, on 19/10/15 iii finally agreed to reverse their decision to make me the correct allocation of 3,975 shares (exactly as Boadica had determined in May) on condition I repay the dividend payment amounting to £2,116.63 within limited timescale. The problem was, as now. I was fully subscribed in my ISA and needed to sell some stock to make this possible. They offered £100 compensation for their error and refund of dealing costs.

The single most consistent element of iii’s handling of my complaint was their apparent complete indifference to the length of time they took to resolve this matter. The Ombudsman appeared to consider their offer as 'fair' and I, by then was actually very tired of the whole business. In spite of the compensation I effectively 'lost out' financially because of the need to sell stock 'at a loss' in order to make the transaction possible within the time frame.

As for the current 'Open offer', with particular regards to NCC in a fully subscribed ISA, my first thoughts are its probably not worth selling assets (unless part of another strategy) simply to make cash available for the few extra NCC shares resulting from the offer.

[masurenguy] 26/11/2015 08:14

Publishing a prospectus and formerly notifying the LSE of the details of a corporate action applicable to shareholders, are two different things.

[sharw] 26/11/2015 08:07

"jumped the gun" = no - if you look at the RNS (link in header)you will see that the prospectus was posted on the 24th.

[masurenguy] 26/11/2015 07:50

Mazarin - your broker seems to have jumped the gun since no official confirmation of this corporate action has yet been released to the LSE. On the assumption that it will be in due course, you can either sell something within your existing ISA (as sharw has already suggested) or subscribe outside your ISA and then effectively simultaneously sell and repurchase inside your ISA on 6/5/16, with the only cost being the spread on that day.

[sharw] 25/11/2015 23:55

mazarin- the only way to take this up within your ISA if you are fully subscribed and have no cash is to sell something within the ISA to raise the cash. Where there is a heavy discount this can be worthwhile but here the discount is fractional (indeed there was a period since the announcement when you could have bought in the market for less than 275p).

Some brokers will let you take up your entitlement outside your ISA but this is iii that we're talking about here. That's the broker that didn't understand how mix and match worked (and you have yet to tell us the outcome of your formal complaint on that).

[kalapattar] 25/11/2015 21:58

Hi MazarinI have received the same offer today. My initial thought is that the discount to 275 seems quite small...though I am a novice at this sort of thing. The share price has flitted just above this level for a month or so. Still I think that the company has an exciting time ahead. After all cybersecurity has an increasing importance going forward. What do others think?

[mazarin] 25/11/2015 20:48

Corporate Action - NCC Open Offer. I have received the following from my broker today : "As a holder of NCC Group plc Ordinary Shares of 1 Pence you have been
allocated a basic entitlement of 1 subscription share for every 10 ordinary
shares you hold. You may exercise each Subscription Share in exchange for one new
ordinary share at a cost of 275 pence per share."
I currently hold these within Share ISA that is fully subscribed until 5th April 2016, so wonder how I can take up the Offer as this will effectively exceed my annual allowance. Any views on this Open Offer from other holders invited.

[lauders] 25/11/2015 15:01

Thank you mazarin. I hope I am not too late and this is in fact the start of bigger things. I think I can just forget about my holding and watch it grow. That would be nice!

PS... I read back before I purchased the holding and also looked through the NCC website etc... Done some research at least!

[mazarin] 25/11/2015 11:21

Today's announcement of Government support for Cyber Security can only be good for the sector generally and hopefully, NCC in particular, for more details see:

[mazarin] 25/11/2015 11:07

A bit late, but welcome aboard Lauders, I don't think you'll have too many worries with this one. I appreciate it's always a tense time when you have just committed funds to a share for the first time. May I suggest you spend a little time browsing back through the posts to get more a feel for recent events currently driving NCC forward. Although, hopefully this morning's rise may provide some comfort.

[rivaldo] 25/11/2015 10:34

Good point indeed re the FTSE250 entry after the acquisition, which should bring in buying as noted.

NCC aims to be the "world's leading cybersecurity player":



And NCC are after more acquisitions with their new firepower:



Extract:

"The extra financial firepower will be used for more acquisitions, said Rob Cotton, NCC’s chief executive. The company, which has a stock market value of £632m, is seeking international expansion as cyber security threats to corporates increase.

NCC said the addition of Fox and its 250 staff will increase its ability to foresee new threats. The Delft-headquartered specialist gathers intelligence on hackers and their techniques from the so-called ‘dark web’ and other sources to help bolster defences.

Mr Cotton said: “We need to get on the front foot and get into the dark markets where vulnerabilities are traded.” "

[lauders] 25/11/2015 01:52

Joined here yesterday with a small purchase as used the last of my available funds to buy at 277p + costs. Wanted something I could hopefully just buy and forget in a sector with growth and potential. On-line security seems to be perfect on both counts and others seem to think NCC should do well including this new employee:

He added: “The Group’s reputation speaks for itself. I’m honoured to be working with a world-class team of security professionals.”



Hope my joining is not the kiss of death. Some of my recent purchases have not been doing well so far but I still have faith in most of them!

[boadicea] 24/11/2015 20:49

robinskardon - Good point.

It is currently in the band below auto entry (325) to above auto exit (376), actually quite close to 350. This should push it to around 310, which is a definite 'in'.
(My figures are at Nov 13th so could be slightly adrift.)
See:

Note: The positions above include the top 100 and the '250' index runs from 101 to 350.

The price , as noted, is high but then so is NCC's own rating and the cost is well covered by the new issue at this premium price. One wouldn't expect a problem if recent growth rates are at least maintained.

[robinskardon] 24/11/2015 20:10

A point that seems to have been overlooked is that this placing will put NCC in the FTSE250 for sure prompting additional buying from trackers, IIs etc.(unless I have missed something)

RobinS

[glasshalfull] 24/11/2015 18:12

Notwithstanding Fox-IT's 2015 growth, based on 2014 numbers it has been acquired on 5.4x 2014 sales and 41.6x PBT, around 24x 2015 EBITDA apparently.

Appears expensive & potentially dilutive to earnings for the next couple of years. Looks to me that they've paid "US tech price" to complete the acquisition. Not suggesting it's a poor one...just expensive IMHO.

Regards,
GHF

[rivaldo] 24/11/2015 13:45

This Dutch article is interesting, noting that Fox-it now has almost €30m turnover.

This is around 20% up on 2014's €24m, continuing 2014's growth rate and implying probably over €4m PBT for 2015. Similar growth, with synergies etc, might see say €5m PBT for the coming year under NCC:



"Fox-IT was founded in 1999 and now generates turnover of almost €30m with a workforce of 220. ‘We needed a partner to expand internationally,’ founder Menno van der Marel told the FD.

The takeover has no consequences for staff or location, co-founder Ronald Prins said. ‘We will remain a Dutch limited company operating under Dutch law.’ Much of Fox-IT’s work is for banks and the government."

[rivaldo] 24/11/2015 11:27

Hi D. It's difficult in this case as the quoted figures are almost a year out of date. Prima facie it looks expensive, but then if Fox-it made say €5m PBT in 2015 and expects say €7m in 2016 then the price doesn't look too bad.

Fox-it also seems to have decent recurring income, which is always worth high multiples.

Interesting as always analysis from Techmarketview:



"Tuesday 24 November 2015

NCC: security step change with Fox-IT acquisition

Hot on the scent of an expanding market, NCC Group is making a step change in its security footprint with the very strategic acquisition of Netherlands-HQ’d Fox-IT Holdings. An agreement is in place to purchase the company for €133m/£93.5m, with NCC raising most the purchase funds via a combination of firm and open placings.

This follows the acquisition of managed security services provider Accumuli in March this year (see here), which increased NCC’s security footprint and created a fourth arm to the NCC business. Previously NCC’s security assets had consisted of a security consulting business within the Assurance division. By adding Accumuli and the planned Fox-IT assets to its security consulting interests, NCC has rapidly increased in security capability and now declares that it wants to be a leading player in the cyber security sector.

With its background in escrow, assurance and nascent domain services, it has the right credentials to move into the adjacent area of cyber security but the competition is diverse and fierce, with everyone from Microsoft ramping up security (see here), to Rackspace entering into managed security services earlier this year, and BT highighing it as a growth sector. Not to mention up and coming security pure plays such as Sophos, Palo Alto, FireEye and many others contending for market share alongside stalwarts such as Symantec.

Fox-IT does bring valuable assets however, including managed security services, advanced threat intelligence, forensics and incident response, plus ‘Sovereign Cryptography’ and professional services. These capabilities and a focus on threat intelligence and security analytics take it beyond traditional information security and event management and into the high value end of security. Add 250 security experts and a client base that includes government security departments and global enterprises and NCC looks like it is buying real value. Its challenge is orchestrating its increasingly its diverse business."

[aylingd] 24/11/2015 10:14

I'm sure they have been working on this for some time but the timing seems immaculate given recent events in France & Belgium. Don't know the company so still looking - their web site looks good. Rivaldo I'd be interested to know what basis you use to value a take-over such as this, is it a multiple of EV ?

Western governments are starting to realise that in the future the threat from the bad guys (like IS to name but one) will be conducted from behind a computer screen, not from a bunch of extremists driving an armoured vehicle across the desert as the popular press likes to portray them.

D.

[masurenguy] 24/11/2015 07:27

Acquisition and Placing @275p

RNS Number : 7238G
NCC Group PLC
24 November 2015

€133.25 million acquisition of Fox-IT Holding B.V.
Firm Placing and Placing and Open Offer to raise £126.3 million (gross)

NCC Group plc (LSE: NCC), the international, independent provider of Escrow, Assurance and Domain Services, has (through its subsidiary, NCC Group (Solutions) Limited) entered into an agreement to acquire Fox-IT Holding B.V. ("Fox"), a leading provider of high-end cyber security solutions, for a total consideration of approximately €133.25m (£93.5m). NCC Group intends to raise £126.3m (gross) through a Firm Placing and Placing and Open Offer at the Issue Price of 275p per New Ordinary Share.

Highlights

· Fox and its subsidiaries (together, the "Fox Group"), headquartered in Delft (the Netherlands), are a leading provider of high-end cyber security solutions comprising of cyber security products, managed security services, advanced threat intelligence, forensics and incident response, 'Sovereign Cryptography' and professional services.

· The Fox Group has a strong reputation and brand with a client base, including government security departments and global organisations.

· The acquisition is a key strategic development in NCC Group's aspiration to become the leading player in the expanding global cyber security market.

· Advanced persistent threats are driving security spending, with a focus on threat intelligence and 'big data' security analytics, beyond traditional security information and event management.

· The Fox Group provides NCC Group with a step change in its ability to provide contextual security analysis, advanced threat intelligence and online fraud detection.

· The acquisition will also provide NCC Group with the potential to:

o replicate service lines internationally;

o diversify into an area of complementary services and products; and

o provide a complete security proposition to customers globally.

· NCC Group and the Fox Group have complementary client bases creating multiple cross-selling opportunities

· Total consideration of approximately €133.25m (£93.5m).

o c. €108.25m paid in cash on completion, subject to a completion accounts adjustment mechanism.

o A further €10m in cash payable and €2.5m in NCC Group Ordinary Shares to be issued on each of the first and second anniversaries of completion.

Funded by:

o Firm Placing raising £63.1m (gross).

o Placing and Open Offer raising £63.2m (gross).

o New multibank facilities: £80m RCF and £30m term loan.

· Earnings enhancing in the medium term - pre revenue synergies.

· The Issue is being fully underwritten by Peel Hunt.

Rob Cotton, NCC Group Chief Executive commented: "This is a unique opportunity to acquire a leading, substantial European cyber security business that focusses on security analysis and threat intelligence; at a time that organisations globally are only now beginning to appreciate that they need to be proactive, not reactive, in dealing with cyber security. Fox has an impressive reputation and brand with a high quality client base, including government security departments and global organisations. The business also has a range of complementary professional and managed services and products which we aim to distribute internationally. The addition of Fox, with its quality management team, 250 technical security experts and personnel and high assurance cryptology and forensics capabilities, enables us to take a further substantial step towards our aspiration of becoming the leading player in the expanding global cyber security market."

Analyst call
NCC Group will be hosting a conference call for analysts and institutional investors at 8.30 a.m. today.

[rivaldo] 24/11/2015 07:26

Big acquisition today of Fox-IT (I've come across them myself - they do brilliant souvenir foxes at exhibitions!).

The best part is that the placing and open offer is at 275p, so hardly any discount at these new levels - the market must like it.

Not immediately earnings-enhancing, and somewhat expensive historically speaking, but this will really cement NCC's place at the top of the cyber-security chain. I'm assuming that Fox-IT's 2015 figures will be much improved on 2014's, which in turn were racing ahead.

[rivaldo] 23/11/2015 11:35

News - great recognition for NCC's Accumuli...

OT : thx chaps - I was hoping there was a source which summarised the IC's tips before the markets opened on Friday!



"Accumuli, part of NCC Group, has won CRN’s ‘Corporate VAR of the Year’ Award 2015
November 20, 2015

Accumuli, part of NCC Group, has won CRN’s (Computer Reseller News) ‘Corporate VAR of the Year’ Award 2015. The award was presented last night at the CRN Channel Awards ceremony in London and recognises Accumuli’s dedication to protecting organisations from cyber threats.

Accumuli was recognised by CRN for its 24x7 operational security support, incident and risk management capabilities along with its ability to be flexible, delivering both specific and holistic end-to-end solutions. The company’s focus on working with its customers to deliver results has helped it attract and retain a list of clients including The University of Hull, Liquid Telecom and Wycombe District Council.

The CRN Awards are the most prestigious awards in the IT channel calendar and recognises and rewards outstanding achievement and excellence in the IT channel".

[aylingd] 20/11/2015 17:35

Riv, Selftrade also post some of IC tips each week, but again I think it is only available to those with an account.

D.

[lollipop4] 20/11/2015 12:16

rivaldo - I get a weekly e-mail from HL which gives 4 of IC's tips, and sector reports from shares mag too. Think you need an account with them, though.

[rivaldo] 20/11/2015 09:39

Cheers gb. I'm not an IC subscriber, so always appreciative of getting the write-ups. Do you (or anyone) know perchance of any web site which summarises the IC's main Friday tips every week?