It's OVER for PFC |
Well that's if the share price rises. But why would it do that? This is just a restructuring. The price may rise afterwards of course depending on what people see as prospects for the company with reduced debt, which currently isn't breaking even. And as per jd96 post above, I expect current ordinary shareholders will get the thin end of any wedge. |
Hi Vibes,
The base for your calculation is 7.4p.
If share price rise, your final value will jump up by 39 times the percentage rise. (39 =97.5/2.5).
E.g at 8p. Your estimated price will increase by 3.1 times.
Correct? |
In auction... |
A rough calculation:
$94 million of new cash will entitle the payer to 26.7% of the restructured company. The envisaged market capitalisation at that point is therefore $94 million x 100/26.7 = $352 million. Current shareholders will have 2.5% of this which is $8.8 million. Current market capitalisation is £38 million = $46 million at a share price of 7.4p. Therefore the share price after restructuring should be 7.4 x 8.8/46 = 1.4p/share. I am quite interested in buying at that price when it is all done, however they will no doubt do a share consolidation at the same time to muddy the waters. |
The FCA lets me invest in this pile of cr@p and lose virtually all my money invested. (or on the myriad of investment trust with really dodgy accounting and subpar performance, when not directly going bust)
But will not let Bitcoin ETFs to be available to UK investors "for our own protection"
Ridiculous |
 Jaknife,
In light of your comments on the lack of candour on the part of PFC and issues of trust around management I had a look at the 23 December restructuring announcement again.
The more one reads it the more questions arise about what is proposed and how executable it really is. It also raises fundamental issues of equity and fairness with respect to how shareholders (and even debt holders) are being treated in terms of how the restructuring cake is being cut.
What I find particularly offensive is that it appears certain shareholders (37%) - which I assume comprise A Asfari and family, AzValor Asset Management and I suspect the Employee Benefit Trust - as well as existing management subscribing for new shares are the beneficiaries of a warrant package for nil consideration that is not being made available to all ordinary shareholders. (If I am wrong about this I am happy to be corrected). What is particularly irksome with respect to any potential for handing additional shares to Asfari, AzValor and Management at no cost is that they are all being rewarded for failure (though I am sure after the losses they have sustained Asfari and AzValor probably need every free penny they can get - it certainly beats selling the Big Issue).
It is worth noting a lot of fees are being paid out and there is significant leakage in what is being injected back into the business. It is also worth highlighting that the 2.5% is subject to further dilution and that given the sweep on the New Notes the prospect of any dividends will be some way off. It is also worth reflecting on how the new Note Holders are cherry picking what they get security over and how super senior their payment obligations will be. Finally, it is also worth querying whether the Ad Hoc group are being overly greedy (and ambitious) in the split between what their debt converts into and that of the other debt providers and whether this is deliverable or a try on.
Would be interested to hear what others think about what is being proposed and just how realistic it is…. |
Petrofac are being incredibly disingenuous. They must know the pricing at which they intend to issue the various equity but they're deliberately sitting on the info. That's not a sign of a management team that should be trusted. |
Well, the derision was certainly ill deserved and the predictions of 2p incredibly insightful. It will be interesting to see how the share price plays out over the next few weeks…
… 2p here we come! |
jd96
4p/sh as an absolute max was the oft posted target I recall.
To constant derison from many (most of those bulls have evaporated and are nowhere to be seen) |
From memory I think that I posted 4p as an absolute maximum but 2p as my target, that roughly equated to a market cap of £20m and £10m respectively. There were a number of rude responses, but those people aren't here anymore! |
GtG,
What was Jaknife’s target?
Close to zero? |
jd96
"The reality is the level of proposed dilution appears to imply the current share price is unrealistic"
It's trending closer and closer to Jaknife's long prescribed target! |
Jd96
Equity holders have no say. it is out of their hands now.
The "not make it easy for debt providers" comment is a busted flush.
The proposed Debt/equity recap is the best it will get. |
GeckotheGlorious
No feet stamping intended.
As stated previously the equity is worthless (and has been for some time).
Only a fool would increase their exposure to PFC.
If you have some, given the little it is now worth, and the onerous terms of the proposed D4E/recap, you should not be making it easy for the debt providers.
It is clear from how the shares and listed bonds are drifting downwards that most think even what is proposed might have execution issues. |
I haven't waded through the announcement in detail as my holding is not worth the effort of trying to get to grips with the complexity so I could have got it wrong but I noted the following para:
"As referenced above, the Company values its retail investor base and is keen to ensure that retail investors have an opportunity to participate in the equity capital raise. The Company therefore intends to announce an offer of new ordinary shares to retail investors to raise approximately US$8m at the same issue price as the New Equity issued as part of the Restructuring, following the publication of the Company’s audited financial statements for the year ended 31 December 2024. The Company also intends to give preferential allocation to those retail investors who are shareholders on the date of this announcement to the extent reasonably practicable."
If the 'intention' is realised then $8m at the same issue price implies almost 1 for 1 at under 2p. A reason why the share price has not fallen as much as might have been expected? |
They both have the same thing in common.
They're bust.
Shareholders have no recourse to the restructuring being proposed.
Stamp your feet all you like.
Nowt going to change as Jaknife elucidates. |
… for clarity, Carillion still had a lot that was attractive about it’s underlying business - exposure to long dated, government backed cash flows, just a bad capital structure and the fallout from some disastrous construction contracts. I don’t believe the same can be said for PFC. Working it out could be very messy. |
This is a slightly different fish than Carillion, though admittedly it does share some of the same legacy issues - mispriced risk, questionable profit recognition, mass haemorrhaging of cash, incompetent management, flaky governance, etc… along with very questionable business practices (SFO) etc… |
JakNife,
Appreciate your input.
Unfortunately I don’t think option B is credible. |
I am surprised the shareholders don’t just say no and call the lenders bluff. When you are getting hosed you may as well use what few levers you have left. |
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