Raven Prop P Discussion Threads

[holts] 12/11/2021 07:27

Putin about to be behind a few local difficulties ?

[kenny] 11/11/2021 15:02

Today, the rouble has reached a 12 month high against sterling.

[rahosi] 11/11/2021 13:15

Test Sale 1.257
Test Buy 1.2675

[cc2014] 11/11/2021 13:02

Why would the management want to redeem the prefs?

They pay an interest rate of 12% whilst the Russian government base rate is 7.5% and likely to go up to control inflation.

Seems fair and reasonable to me.


Meanwhile the buying continues and the offer moves up again. Nice.

[gfrae] 11/11/2021 10:14

Kenny, nor do I at the moment, though if the share price ever goes to a price that reasonably reflects the underlying assets and prospects, it may regard the Prefs as expensive and wish to buy them back by either issuing new ordinaries or raising more bank debt.
As many of the same institutions own the Prefs and the Ordinaries they will look at what is overall best for them and presumably with their agreement they could be cancelled.....remember what happened to the Convertibles.

[kenny] 11/11/2021 09:53

gfrae - I don't think redemption of the preference is a possibility - ever. If any debt is to be repaid, it will be bank debt first but being lowly geared is not managements objective. Also, the company has a long history of directing its net annual cashflow to buybacks of the ordinary.

In any event, there are two other protections for preference holders. First, any proposal to redeem requires a vote by 75% of those voting to vote in favour. Note that Quilter owns 31.6% of the pref's so can and would block a vote that was not favourable to its interests. Second, the Articles also provide that in the event of a takeover of the company, the stock exchange quotation for RAVP will be maintained.

[gfrae] 11/11/2021 09:27

Hypothetically if the management at some point in the future did wish to redeem the Prefs, presumably they could with the agreement of a majority of the Pref shareholders ?
At the moment with the Ordinary share price slouching aggressively at a discount of 40% to NAV there is no likelihood of that happening.

[jaf111] 11/11/2021 07:55

2022 Pref Dates confirmed....always useful to have in advance....

[kenny] 11/11/2021 02:43

zangdook - you may well be correct. However, I suspect that now that Lloyd is following Natwest, a number of other financials institutions will also do the same - like Aviva, Santander, Standard Chartered and others.

All financial companies have the same problem with preference shares currently in issue, namely, they are not recognised as capital under the latest Basel rules. The solution is to get all or as many as possible redeemed. Probably all will follow the tender route because no one wishes to repeat the disaster of Aviva trying to buy them back at par.

For those not tendered, there may be further tender offers in later years, which may or may not be at current prices if interest rates rise materially. Investors who intend to hold their shares throughout the interest rate cycle may not tender, but others will.

The 16% take up on NWBD has not put Lloyds off and they are even offering a slightly lower exit price (higher exit yield) than Natwest.

[zangdook] 11/11/2021 01:43

I don't see a reduction in the choice or availability of prefs - there was what, 15% takeup for the NWBD tender a few months back? And it's not noticeably less liquid than before.

[holts] 10/11/2021 20:58

It's a cute move with the prospect of Inflation and supposed rate rises on the cards , however the yield at offer is not enough to make me sell up , particularly with the listing remaining , be interesting to see if it's broadly taken up . I prefer to keep taking their coupon and investing it elsewhere .

[rayg5] 10/11/2021 18:05

Yes, great news, Kenny, and we have to bear in mind that management is heavilyinvested in RAVP.

[kenny] 10/11/2021 17:53

Lloyds Bank has this afternoon announced a tender for all it’s sterling preference shares as well as some of its non-sterling fixed income securities:




The quantity of sterling preference shares available to UK investors just got a lot smaller – and will get even smaller if other banks follow suit. No doubt Aviva will follow suit on its four classes of preference, not least because it tried, disastrously, to buy them back at par some years ago.

Interesting that holders need not accept the offer and their rights will be maintained, including the stock exchange quote, so it remains to be seen how much is tendered.

For the main UK preference classes, Lloyds tender price is at an effective yield of 5.5%. I do not regard that as a read-across value for RAVP but I do highlight the fact that within a year or so, RAVP may be one of very few preference shares in sterling available to UK investors.

For long term holders of RAVP, like me, I think this is excellent news.

[montyhedge] 10/11/2021 17:37

Well I have seen the ups and down in the last 10 years for Raven Russia, but this has never missed a payment.

[rayg5] 10/11/2021 10:16

It's a widespread City misconception that Russia is risky. With its energy dominance, how risky in truth? I see no better yield vs risk out there. Let these British fools believe what they want.

[igbertsponk] 10/11/2021 08:54

I wish this would stop going up, I want to add shortly!

[owenski] 10/11/2021 08:25

My Retirement Fund - spot on, UK is run by self serving fools all built on the Brexit lie.

[mister md] 10/11/2021 08:22

CC2014 - but at 150p this would still be yielding 8% wouldn't it ? Would be hard to find better returns elsewhere and best to keep this in a well-balanced portfolio imho

[my retirement fund] 09/11/2021 19:02

Jeez I'll be breaking even at this rate, whats going on? Is Russia's Putin suddenly looking a lot more credible than Boris the clowns UK now that its a post basket Brexit Britain being run by its lying cheating negligent and highly incompetent pro Brexit clown and his laughable bunch of bent cronies?

[cc2014] 09/11/2021 15:54

I'm not so sure the overhang is that large now Kenny. The share price seems to be going up on small volume.

That's not to say we won't hit 130p or whatever and some holder with a million shares appears and wants out.

I'm in the position as many on here. Nothing much to think about with the share price at 125p. It's still crazy low. When it reaches 150p I'll have to think about it a bit harder. I suspect though it will have to get to 165p to tempt me to sell. After all I'd have to find a new home for the proceeds which is as good and that would be challenging.

[montyhedge] 09/11/2021 12:47

I been in Raven since 2011 never missed a payment, I think 2013 they were trading at 167p. Still cheap at today's price.

[gfrae] 09/11/2021 12:36

They are 125.2 bid and 125.99 offered at the moment.
Ordinaries appear to be lagging.

[kenny] 09/11/2021 11:44

Sellers are now active at this level. I suspect there is still a large overhang of shares from the placing. Perhaps the motivation for short term holders is: what will the price move down to after it goes ex-div on the 18 November if sellers place a large number of shares in the market.

Fortunately, I am a long-term holder prepared to ride out gyrations but aware there are a lot of sellers waiting in the wings. My primary focus remains on the ability of the company to keep paying the quarterly coupon.

[cwa1] 08/11/2021 16:01

Yes, it is

[jaf111] 08/11/2021 15:58

Surely going xd Thursday week so another 3p about to be collected......