Open Orphan Share Discussion Threads

[plasybryn] 12/2/2021 09:03

Well done Scotty. Can I copy that across to LSE?

[jansky61] 12/2/2021 08:22

A friend has bought 7750 as an "opening trial" as he so delicately puts it!

[mark10101] 12/2/2021 08:15

97% cure rate for severe to moderate hospitalised COVID patience in Israel.

Approach - immunomodulator!

[jansky61] 12/2/2021 08:12

Yes, thanks Scotty. Time to look under the bedclothes for some cash.....

[666james] 12/2/2021 08:01

scotty1 11976 many thanks a good read

[sh0wmethemoney] 11/2/2021 22:25

Additional recovery option, helps support The challenge study sign off

[kpe] 11/2/2021 19:50

Smart move for CF, the special div. would be as he is locked from selling shares , this way it enables him to get his hands on some cash while limiting his personal risk.

[arab3] 11/2/2021 19:11

Discojames, I read it wrongly,thought it was normal Divi, I will stand in the corner now suitably chastised !

[sh0wmethemoney] 11/2/2021 19:05

Updated today



‘Participants enrolled’

😋

[eeza] 11/2/2021 18:10

Better to wait for it to happen, before you start counting your money.

[discojames] 11/2/2021 18:06

Arab, there is a huge difference between a dividend and a special dividend. If a company worth £10m sold a non-core asset for £100m, the price can't fall by £100m unless it goes up by 100m on the announcement.

[chopsy] 11/2/2021 17:52

I agree with Pierre and toyin. Sorry elrico I haven't been able to read that link yet.

[elrico] 11/2/2021 17:28

Peeps,

Ref in-specie divi. We have a very good example, be it with important caveats. I offer an illustration which I think will give us a good indicator for the future.

[toyin] 11/2/2021 17:11

No problem Pierre, I am just making the point that this isn't a normal divi situation.

[pierre oreilly] 11/2/2021 17:02

961

toyin, yes you're correct.

But it's a moot point.

More correctly, instead of saying it will drop on going xd, we should say our orph assets will drop by the amount of assets taken out, and which we now own in another company.

Orph consolidation just won't happen, simply because it achieves nothing at all and costs a lot. And that isn't c's style at all.

That is not to say we won't gain from an is divi!. The big gain will come on the announcement (by a value assigned by shareholders trades after the mm's initial markup). If the announcement says orph's share of imutex is being floated at a value of #100m, and only 10m of that is already in the price, then 90m will be added onto orphs cap via trades on the announcement (in an efficient market). #100m will come off orphs cap on xd (either by a share price drop or fewer shares in issue). The net shareholder gain is 90m overall in this exaqmple.

[toyin] 11/2/2021 16:58

Malcolm, this is the last from me but let me leave you with this.

Lets keep it simple, hypothetical ORPH worth £200m

New co (divi) worth £100m

So market finds out and ORPH goes to £300m, then on ex div day we drop back to £200m and get new co shares valued at £100m

There is no way, and I mean no way ORPH will recover to £300m in a week or two!

[king suarez] 11/2/2021 16:54

That happens if the dividend is a few % of the market cap. We are talking about dividends that are potentially quite a lot larger here!

[malcolmmm] 11/2/2021 16:49

The price will usually drop XD but in my experience quite a few companies recover the amount of the reduction a week or two later

[toyin] 11/2/2021 16:47

Pierre, yes I understand that. If we know the divi is worth eg £50m we will increase by £50m then drop back on ex div, if that is how it is structured. My point is until we know how it is to be structured to say we "will" drop is stupid.

[toyin] 11/2/2021 16:44

arab, you are looking at it from a cash divi point of view, which is simple to work out. We dont know what the value of this divi will be, or how it will be structured. So saying the price will drop is stupid because we have no information yet.

[pierre oreilly] 11/2/2021 16:42

toyin, i don't know that particular situation, but i do know if one day you are trading with something in the company worth 40p, and the next day you're trading without that something worth 40p, the share price is marked down by 40p. (the 40p becomes another asset you now own outside the original company, keeping the overall asset value constant). If the price didn't drop, then that means 40p has magically appeared somehow.

You sometimes get consolidation os shares at the same time, in which case the price stays the same, but the number of shares you own goes down - effectively selling 40ps worth of shares.

[arab3] 11/2/2021 16:36

Sp usually drops by the amount of Divi in my past experience

[toyin] 11/2/2021 16:35

Pierre, it depends on how it is structured.

When opti spun sbtx out, the opti price didn't gap down. Opti informed the market on 21/3/17 and sbtx floated on 5/4/17 and at no point did opti shares gap.