Rhythmone Share Discussion Threads

[1gw] 13/9/2017 11:01

LCWA there is a "no solicitation" clause (6.6 on page 76) meaning YuMe cannot encourage someone to submit a counter offer, but there is also a clause 6.1(b) on page 70 which says that if they nonetheless receive a "Superior Proposal" then they are allowed to terminate the R1 agreement subject to certain conditions which include allowing R1 to match the superior proposal.

[sikhthetech] 13/9/2017 10:57

first viewable marketplace??

Teads claims online video ad industry’s first viewable marketplace

[lance corporal winstanley ash] 13/9/2017 10:43

There is a clause stating yume cannot accept any other offers, gw.

[1gw] 13/9/2017 10:41

wheeze - not really, but I do think arb traders and those effectively making an arb trade are likely to drive the relative prices of R1 and YuMe. The prices should move broadly in parallel if the merger is viewed as likely to complete but I think arb trading will pull back R1 relative to YuMe when the difference becomes greater than some relatively small % which reflects risk to completion.

As I tried to argue before, anyone who is relatively indifferent to holding either US or UK stocks and wants to buy R1 might prefer to buy YuMe if they see the discount in the YuMe price and they think the merger is going to go through.

And some UK holders, while not "arb traders" as such, might like both the apparent discount on offer and the diversification that would come from reducing R1 and buying YuMe. The diversification argument would be unlikely to carry a lot of weight if they think the merger will go through, but there's always a small chance of a counter-offer, or even a sweetened offer, as well as the thing falling apart.

[wheeze] 13/9/2017 10:26

With the arb widening again this morning against the YuMe closing price it looks unsustainably high again to me. So either YuMe should rise or perhaps more probably, given the apparent lower volatility of YuMe, R1 will fall if more arb sales go through.1gw, doesnt this argument make the assumption that there is no-one else trading except for arb traders ?

[football] 13/9/2017 10:17

any share buy back R1 have to Rns it first

[1gw] 13/9/2017 09:51

loaf - I suspect ROne/Numis buying stock in the market might run into serious US regulatory issues. Wouldn't it run the risk of being seen as a price support action designed to make the YuMe acquisition price look more (perhaps artificially)attractive ahead of the YuMe shareholder vote?

[1gw] 13/9/2017 09:48

I've locked in the other half of Friday's arb trade given the rise in R1 price this morning. I reckon about 8% in it (i.e. sale price of R1 this morning about 8% higher than implied purchase price of R1 through YuMe purchase on Friday). In hindsight should have taken the higher R1 price on offer Friday afternoon.

With the arb widening again this morning against the YuMe closing price it looks unsustainably high again to me. So either YuMe should rise or perhaps more probably, given the apparent lower volatility of YuMe, R1 will fall if more arb sales go through.

[loafofbread] 13/9/2017 08:53

I can't see any reason why ROne/Numis can't buy excess stock in the market.

Anything below the 37.5p new stock issue price is a saving to us and also acts as a floor.

[loafofbread] 13/9/2017 08:35

If the $ keeps on getting stronger you can kiss good bye to your Yume/RO trade.

The rest of the ad tech sector of to the races and we are at yearly lows.

That said we should get 3 important milestones in the next 4 weeks that will pretty much make or break this stand off.

ROne offer doc to Yume that should have up to date info. (assume before our EGM?)
EGM Q/A and meeting.
Trading Update by mid October. ROne only chance to kickstart this malaise with some actual info on the 2 integrations and the last 6 months trading.

If ROne haven't learnt their lesson from the AGM and inept one line TU then we have no chance because they clearly dont have the right people making the decisions.

[sikhthetech] 12/9/2017 23:43

Internet mysteries: Why do ad tech companies rarely die?

[bennywin] 12/9/2017 21:50

Nice to see this one at 240 lol.

Great call Barky.

When it's down to 24 and you get your ten to one you have hit the jackpot.

You are a genius.

[barkboo] 12/9/2017 21:15

Good to see Johnny Boy now rates this a sell - he never is the right side of a trade. lol

[lance corporal winstanley ash] 12/9/2017 18:18

Rhythmone seem certain about the takeover. It's plastered all over their website. Www.rhythmone.com

[1gw] 12/9/2017 18:05

FCA report is for net short positions above 0.5%.

For arb players I suspect they would have to report above 0.5% short R1, even if they expected to be covered by a long YuMe position. Since the merger isn't certain to go through I don't think they could net the 2 positions off for FCA reporting purposes.

0.5% is around 2.5m shares though, and given the typical traded volumes on R1, even during this period of "excitement" it seems like it would take a while to accumulate such a position from scratch. If one arb player is interested, I would have thought several would be, and so it may be that each player is getting a relatively small proportion of each day's volume.

An arb player appearing on the FCA spreadsheet would be one sign that the arb really is being played here. But it may be that existing shareholders are the main ones playing the arb by selling down their long position and buying YuMe - in which case a holdings notice might be the first clear sign. If arb players do need to borrow shares to put their R1 shorts on, those shares may be difficult to come by if the owners of them do themselves want to make the arb trade.

[polythene] 12/9/2017 17:08

Are Shares on loan necessarily shorted? Don't they have to appear in the daily short report? Nothing against Rhythm so far.

[wheeze] 12/9/2017 15:33

I think they have walked the price down as far as they can. Any lower and we may see a rush of buys. However you are right 1gw. This deal seems to present a gift to arb traders with little risk attached.

[1gw] 12/9/2017 14:49

Wheeze - should be easy for shorts to close while arb traders are selling R1. No squeeze on the arb traders if the merger completes as they'll close out through their Yume entitlement.

I would argue that the price has done anything but hold up so far!

[wheeze] 12/9/2017 14:45

Any suggestions from the many here posting negative views on R1 as to why the price has held up so far despite the short selling ? Shares on loan have increased, no doubt due to shorters hoping for a carnival of R1 shares to be sold by recepients on completion of the YuMe transaction. I am looking for another sub 30p entry point, though wont hold my breath. On the other hand, the chances of a short squeeze are considerably enhanced.

[sikhthetech] 12/9/2017 14:05

European connected tv advertising market set to grow by 26%

[sikhthetech] 12/9/2017 13:24

stocky, good point... wonder if it was ES, who wanted the vote pre-H1 end and TU...

[lance corporal winstanley ash] 12/9/2017 13:18

There should be a trading update first week in October. You would hope anyway!