Pires Investments Share Discussion Threads

[moreforus] 02/4/2014 07:34

will we get some buyers today or is everyone waiting for the ipo and / or the new tax year....??

[h2owater] 02/4/2014 07:22

2 days to Rame-Energy IPO!


Pires backs Rame Energy's AIM ambition

Monday, 10 February 2014 22:38

AIM-quoted Pires Investments has taken a pre-IPO stake in Rame Energy, a consultancy focused on the Chilean wind power sector, which plans to become an independent power producer.

Rame Energy wants to raise at least $3.2 million and intends to join AIM in the first half of 2014. Rame had net assets of $4.6 million at the end of 2012. Revenues rose 10 per cent to $6.6 million in 2012, although pre-tax profit fell from $1.3 million to $1 million.

Rame says that it has been involved with the development and construction of a significant part of the installed wind capacity in Chile. Rame is developing its own projects and the first two will have a capacity of 24MW and these will be followed by two projects with a capacity of 84MW.

Pires is investing £410,000 in a three-year convertible loan note. Rame has a pipeline of 23 projects with more than 1GW of capacity. No interest is payable for the first nine months and then, assuming the flotation has not happened it is payable at an annual rate of 10 per cent, accruing from the date of the initial investment. As long as the valuation of Rame is more than $33.33 million before any new money is raised then the conversion would be equivalent to a discounted valuation of $25 million.

[outspan] 01/4/2014 22:31

Indeed swizz, even if the PIRI BoD didn't want to announce while there was still a degree of uncertainty and/or lack of detail re Rame's listing, that is surely not the case now after today's further announcement so I would expect PIRI to update us very shortly.

I find it extremely hard to believe that the CLN has been converted though. I see this as being more likely a separate investment in the Admission placing. My reasons are several but include:

• CLN is for a term of 3 years. The asterisk in the PIRI RNS does not allow for any variance except in circumstances which no longer apply.

• It would seem particularly bizarre for Rame to have structured their pre-IPO funding as 3-year CLNs (don't forget they intended to raise a total of $3.2m by this means, 5 times PIRI's contribution) if they had given entitlement to convert into ordinary stock even before Admission and, if they had, wouldn't this have been stated alongside the other conditions in the PIRI RNS.

• Moreover, on the conversion at 25% discount theory, I can't see that this condition even applies because this double asterisked criterion was conditional on no Admission occurring for more than 12 months so ??? Even if my understanding is awry here though, it just doesn't stack up if my calculations are correct - 18p discounted by 25% is 13.5p in which case PIRI's £410k would amount to a little over 3m Ordinaries. In fact, PIRI's apparent 3.5% holding on Admission must amount to c. 3.66m shares.

• Yet another pointer against conversion having already taken place is that PIRI stands alone as a new major shareholder. Wouldn't there be others who contributed the other 80% of pre-IPO CLN funding who would have done likewise if it were possible?

• Isn't it true that pre-IPO funding is distinct and separate from further funding then raised on Admission i.e. Rame raised $3.2m in CLNs to facilitate Admission and have now raised a further £2.1m on Admission for forward working capital etc. by issuing c. 11.66m Ordinary shares?

• According to past accounts and last placing, PIRI had the cash or access to it via asset sales to have been able to take a stake in both CLNs and Ordinaries. As I previously mused, it may even be that their participation in the former actually facilitated a "privileged" participation in the latter.

All considered, I'm sticking with this being an additional c. £600k investment by PIRI in Rame Ordinaries, stacking up to £1m exposure in total to what looks set to be a worthy future. I guess we'll see soon enough.

[swizz] 01/4/2014 20:04

Very surprised to note the Pires BOD have not updated the market, as the detail provided by Rame is quite clearly of material value to Pires market valuation, it would be good to know if the CLN has been converted, or if we have participated further in the admission placing,

Based on the numbers provided by Rame in the sch 1 update today, it looks as if we have converted the CLN in to shares and we have bagged the 25% discount, all bodes well for the days ahead IMHO.....GL S

Sch 1 re-issued at 16.15pm confirming mkt cap on admission at £17.1M

[outspan] 01/4/2014 16:52

As m4 suggests, prob some end of tax year factors but still a feeling that MMs are stifling any buying pressure by opening up the spread so wide for no apparent reason. Certainly offering neither bargain prices nor great volume on the buy side so could well be an order being filled or maybe just attempting to accumulate any loose stock for themselves ahead of stronger demand, whether for new FY or fundamentals or both.

[the_beagle] 01/4/2014 16:11

Yesterday we had 8 deals for 12 million total. Today zilch on some good news find. Hard to explain but clear to me that there's some good value in the RAME deal.

[outspan] 01/4/2014 14:08

Further to last, if assumptions correct, reckon CEO Tim Adams has chucked in £120k in the funding order to partially offset his dilution.

As co-founder of Rame in 2002, especially good to see that he is still backing its future with substantial personal investment this point, rather than any sign of him using the admission to cash in.

[outspan] 01/4/2014 13:41

Good to see that all existing shareholders are staying in substantive force, merely being diluted by around 14% by the enlarged capital, major exception being the CEO who appears to have bought more in the funding to the extent that his holding is diluted by a lesser 8%.

Alongside this, to raise the £2.1m mentioned they have presumably issued 11.666m new shares which would also equate to a circa 14% dilution thereby confirming the observation above for those shareholders not participating in the funding.

PIRI would appear to have taken around 3.333m or 28.5% of the shares on offer. As such, they have become the only new major (>3%) shareholder. Seems to have been a fairly tight circle of participants which will hopefully lead to a strong market on Admission.

[moreforus] 01/4/2014 12:38

I'd expect to see some interest in advance of Friday if not today....

general market is dire as people sell for those tax losses.!

[outspan] 01/4/2014 12:34

Marvellous news! Is it April Fool's Day or something? One would think they will shortly have to RNS that they've secured this holding which should lead to some wider attention and coverage.

[outspan] 01/4/2014 12:28

And, of course, that would be ahead of any upward premium on Rame's listing!

[outspan] 01/4/2014 12:24

At 18p, I make that a £600k investment, beyond the £410k CLN. If so, stacks up to PIRI having a £1m stake in Rame. Not at all bad in the PIRI NAV stakes!

[outspan] 01/4/2014 12:20

outspan 21 Mar'14 - 12:05 - 2158 of 2304 0 0 edit

Wouldn't it be nice if PIRI's participation in the pre-IPO funding opened another door to an allocation in the admission funding

[moreforus] 01/4/2014 12:00

so we are getting stock but we have not converted yet.....

[supermabs] 01/4/2014 12:00

Hadn't realised the percentage was on origional RNS!

[supermabs] 01/4/2014 11:55

Ahh the plot thickens:

Just seen the Rame Energy 9am RNS:
95,269,451 ordinary shares
Pires Investments Limited - 3.5% share holders

[moreforus] 01/4/2014 11:45

end of tax year...they killed the momentum by dropping the bid.,...but not the offer.....lots of reasons possibly....

if it goes up people want to buy....

[supermabs] 01/4/2014 11:34

Not cheapening it up? Don't think it could get too much cheaper! Surprised there isn't more interest ahead of Rame IPO on Friday.

[moreforus] 01/4/2014 11:15

tried to get some cheap ones .... order knocked back....

[the_beagle] 01/4/2014 09:07

My portfolio might have been down yesterday but it's up on the year. How's OCT doing? Another sell this morning I see. Where's the good shepherd by the way? Or are you he in different clothing?

[5310carraroe] 01/4/2014 08:29

the_beagle 31 Mar'14 - 14:30 - 2289 of 2294 0 0

Down like most of the rest of my portfolio.


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So you do get things wrong!

So your failed investment in MNC ("will increase by multiples of 3p")was not just a once off.

[outspan] 31/3/2014 16:22

"...At 0.06p a share, Pires is valued at £1.4m and the Rame stake could underpin much of this valuation."

Well if that turns out to be true, I reckon there should be another £1m of other net assets, worth at least another .04p on top of it, giving good scope for a 50% rise just to be trading at NAV/nominal value, never mind if we should ever see PIRI attract a premium to NAV if it becomes a convincing play whether through shrewd deals and/or parachutes into the Boardroom a la Kennedy Ventures.