Raven Prop 6.5 Discussion Threads

[davebowler] 02/12/2019 11:42

Scrip dividend Tax

[ramellous] 02/12/2019 11:40

Thanks for that good reply. I wasn’t aware that RAVC were redeemable at 1.35. So that’s a guaranteed 30p profit on today’s price in 6 yrs along with a 6% yield in meantime. I can’t see much point in the share price dropping in that case unless it’s all Woodford related.

I have a small amount of ravp in my sipp.

[yieldsearch] 02/12/2019 10:58

Ramellous:
not sure that they are preferable to the RAVP, as they have different payout (Ravp large coupon, ravc large part of the yield is crystallised as maturity in july 2026), and also for the ravp dvd if it is received as certificate, it is part of your capital gain tax allowance, not income tax.

see below summary feature of RAVC:
dvd date: 31st March, 30 June, 30 Sept, 31 Dec
dvd rate:6.5% per annum
if dvd not paid, it is accruing at 8%, rising to 10% if not paid for 6 months
Ravc dvd is ranking in priority to the payment of any other shares (pref or ordinary)
Ravc capital is ranking senior to any other share, and that priority amount is increasing by 3.5p per completed 12 months since closing
redemption at maturity (6July2026): £1.35 (versus issue price of £1.00
conversion rate: 1.8181 ord shares for 1 convertible shares


So ravc is senior to ravp in term of dvd and capital. however the ravp dvd is paid on an ongoing basis, you have to wait till the ravc redemption to receive the full return on ravc.
ravp running yield is higher than ravc running yield (12p vs 6.5%)
yield to maturity on ravp is really 12p /current price
yield to maturity on ravc is the 6.5 coupon/ ravc price, plus discount of the 1.35 to be received at maturity. and also the option value in the convert (just time value now i guess, too far away to be exercised)

lastly, because ravp is a perp vs ravc expecting to redeem in 2026, it is more sensitive to change in interest rate that ravc: if interest rate environment is shooting up (yield curve), it would have more negative impact on the ravp than the ravc, as ravp has a larger duration (this paragraph may be completely irrelevant if people assume low interest environment for long term, just fyi)

i have both ravp and ravc. ravp for the tax feature, really thanks to Kenny on the RAVP chat, he has a wealth of knowledge on this company, and ravc in tax sheltered structure (sipp) for the capital appreciation and the added bonus of potential conversion.

[ramellous] 02/12/2019 10:20

Can I ask why these are preferable to the RAVP which have a 9% yield?

[stun12] 02/12/2019 09:15

Picked up a few at 104.48. They seem to be quite available down here - presumably an overhang left from the forced sale by Woodford. Last time I tried to buy, the offer was pretty silly given the unload price, so I left it alone. 6.2% running yield plus the promise of ~30% capital growth over the next six years.

[davebowler] 26/7/2019 14:04

Looks a pretty good return from here over 7 years, with c.3% compound capital growth and almost 6% income. On top of that there's an equity kicker potentially!

[zangdook] 24/7/2019 11:22

What's the conversion price on these?

[hindsight] 24/7/2019 08:54

If I was in the Woodford fund, would be rather annoyed they didnt drip them into the market otherwise what are they taking fees to do. And as a potential buyer also annoyed they didnt drip feed in as would paid more than 95p for some

[catsick] 24/7/2019 08:49

I would be happy to buy a shed load at 100

[tyranosaurus] 22/7/2019 15:58

I was quoted 111p to buy 10k.

No doubt the recipients will be selling at a fast profit.

[davebowler] 22/7/2019 15:48

Apparently Woodford has dumped millions of RAVC at 95p (ish) and Singers have placed the lot at a profit!
Missed out when I tried to buy at 97p.

[davebowler] 11/6/2019 22:14

WPCT thread....

[davebowler] 11/6/2019 22:13

See WCPT thread, recent daffy Jones comment.

[stun12] 22/6/2018 10:03

Thanks, Dave.