R&q Insurance Share Discussion Threads

[simon gordon] 26/5/2022 11:09

afilip,

Got you!

For value to be unlocked they could/should sell Legacy and focus on Program.

It's Legacy that's killing the share price.

Or split the company.

[afilip] 26/5/2022 11:02

Agree, I meant it somewhat ironically, as Slater and co seem to think it’s worth far more than 175p.
They expressed interest to contribute the $100m, but I note that the placing has not been underwritten.

[simon gordon] 26/5/2022 10:50

afilip,

Brickell thought it was worth 175p plus $100m to plug the balance sheet.

Before the bid it was 140p without news of the $100m hole.

If they had released news on the balance sheet at 140p the share would probably have gone sub 100p. Now add into the mix that Brickell the largest shareholder has pulled their bid because of a "material breach" and in the 80s seems fair.

74% of shareholders wanted to sell the company.

Raising $108m with that story is not going to be a bundle of laughs.

[afilip] 26/5/2022 10:01

So if investors think R&Q is worth much more than 175p, why is it trading at 85p then?

[afilip] 26/5/2022 09:59

Sale of insurer Randall & Quilter goes up in smoke
Ben Martin, Banking Editor
Thursday May 26 2022, 12.00am BST, The Times
A big deal in the City has failed after Randall & Quilter investors resisted a US bid

The £482 million takeover of Randall & Quilter has imploded amid a backlash from the insurer’s shareholders and a U-turn by the US investment group that had wanted to buy the London-listed company.
Randall & Quilter needed the backing of 75 per cent of its shareholders at a vote yesterday for the sale to Brickell to go ahead, but revealed last night that it had fallen short of that threshold.
Its failure to secure sufficient investor support came just hours after it revealed to the stock market that Brickell was also trying to walk away from the deal, sending the insurer’s shares tumbling by 59p, or 42 per cent, to 81p.
Randall & Quilter unveiled its plan to sell itself to Brickell, which is also its biggest shareholder, at the start of April as it sought to shore up its finances. Not only was Brickell agreeing to take it private for 175p a share, but the US group was also pledging to provide $100 million of equity funding to plug a capital shortfall that Randall & Quilter had discovered in its finances.
The insurer will now attempt an alternative fundraising to fill the hole.
It was revealed by The Times this month that Slater Investments, another big Randall & Quilter shareholder, was opposed to the sale. The investor vote, originally scheduled for last Friday, was adjourned until yesterday to give the insurer time to win over shareholders after the scale of resistance to the deal became apparent.
A change of heart at Brickell added to Randall & Quilter’s woes. The insurer revealed yesterday morning that it had received a letter from its suitor alleging that it had breached the terms of the deal. Brickell claimed this gave it grounds to terminate their agreement, which Randall & Quilter disputed.
It said last night it would seek to raise about $100 million from a placing and up to $8 million from an open offer. Alastair Campbell, senior independent director at the insurer, said: “Our priority now is to secure the funding needed to de-lever our balance sheet and improve our financial profile.”

[simon gordon] 26/5/2022 08:31

Thanks Martin!

[martindjzz] 26/5/2022 08:28

Hi Simon, I've had a mate send me a photo of the Times article and it does not say anything other that what we already know from the R&Q press releases.

[simon gordon] 26/5/2022 07:12

Morning!

I see there is a piece in the Times today, any chance of copying it on here?

Do they mention why Brickell walked?

[topvest] 25/5/2022 21:11

They have really messed this situation up. It wouldn't have happened with Ken Randall still in charge in my view. They are looking at a c50p placing now, if they are lucky.

[afilip] 25/5/2022 20:07

Could it have been discussing a potential fundraising with other investors, perhaps without consulting with Brickell?

[simon gordon] 25/5/2022 19:20

I wonder what the "Material Breach" was? All Brickell had to do was accept today's vote. Why did they jump before the vote as it's just destabilised the price and created a higher level of uncertainty.

Spiegel looks to have played it very poorly and I wonder if he's going to be a casualty of the whole episode?

[superadams] 25/5/2022 18:44

Had it all not been done in a rush and retail holders sidelined, I actually thought this was the outcome many of us wanted in the first place.

[fred177] 25/5/2022 18:38

Superadams, your'e right i should wait to see the price

[spectoacc] 25/5/2022 18:30

Retail thrown a bone, but what sort of bone will it be - now a 2 week delay until the fundraise is actually undertaken/price known.

$100m not small in relation to the (now) market cap.

Major shareholders - presumably Slater & co - backing it. Despite the delay until pricing, seems generally positive.

"Following a short market sounding process, certain existing shareholders have indicated strong interest to subscribe for in excess of $100 million in the Fundraise."

"...In order to provide a wider group of shareholders with the opportunity to participate in the Fundraise, qualifying shareholders are expected to be provided with the opportunity to subscribe for ordinary shares in the Open Offer at the same offer price as the Placing for up to an aggregate value of $8 million.. "

[superadams] 25/5/2022 18:29

Why are you assuming that the placing price will be much different to the offer price in the market.

[fred177] 25/5/2022 18:25

so placing announced and big holders get first dibs, once again retail investors are screwed

[topvest] 25/5/2022 15:11

Blimey. This has blown up. Always the risk on captive legacy insurers. Founder exit, best to sell, is the lesson here. Fortunate for those of us that exited, but very painful for those that are left. Still have an indirect holding through Aurora Investment Trust. Any fundraising could be highly dilutive now. It makes you wonder whether the buyer had already lowered the price because they came across one issue and now another one has appeared.

[fred177] 25/5/2022 14:44

A M Best are reviewing their credit rating, slippery slope ?

[simon gordon] 25/5/2022 14:35

Forever,

Yes, plenty of experience backing losers!

[bulltradept] 25/5/2022 14:27

Stonking buy 5 yr low.

[foreverbull] 25/5/2022 14:13

It looks like the fall may accelerate and stop at when it hits 50% in terms of downfall

[foreverbull] 25/5/2022 14:12

That's beyond my time ... shows how much experience you've

[alun rm] 25/5/2022 13:28

I too sold today, I suspect that there is more bad news coming.... ?