Rpc Share Discussion Threads

[jw121] 23/10/2018 16:28

I don't think the take over panel would have granted a time extension if there were no serious discussions taking place. Nor do i think that in the absence of a bid the H1 results will dispel the lingering doubts about the underlying perfomance of the company. The trading statement alluded to profits being at the low end of expectations with the comment which was made about raw material head winds. So i think with certainty we can say the results are not going to be stellar and the best we can hope for is an improvement on cash generation. So i don't see any short/medium or long term benefits of the faux bid theory.

[squidsgone] 23/10/2018 16:25

Thanks Jeffian,

Rather than 'give substantiation to NT suggestions', the market may (will?) infer from a no bid that they are not dispelled, therefore will still exist (perhaps even more so) when the interims, (and subsequent near term results), are published.

Sorry, but can't follow your logic as to how it would help maintain/increase shareholder value in the short to medium term.

I agree, longer term achieving the fundamentals will help considerably as the supposed 'ruse' only helps if the acquisition trail continues well into the future.

[jeffian] 23/10/2018 16:00

Agree absolutely, Phillis, and that's exactly what they should be doing.

squidsgone,

The share price had been in pretty continuous decline since the highs of early 2017 and by July 2018 it was in danger of going into freefall, plunging to c.£6. Look at the chart below and spot the following. The first unusual statement was made by the Chairman at the AGM Trading Update on 18/7/18 when he made a Delphic allusion to "resolving" the weak share price caused by shareholders not supporting his acquisition strategy. That was widely interpreted as putting the company "in play". This was followed on 22/7 by a Daily Telegraph article reporting major shareholder Standard Life saying the weak share price made RPC vulnerable to a bid. Then on 10/9 we had the 'response to press speculation' RNS talking about "preliminary discussions" which "may or may not" lead to a bid.



It buys them time (during which they hopefully continue to pump out the figures and eventually the fundamentals overcome the NT innuendo). Sure, a 'bid talk off' announcement will unsettle the share price but we're now only a month away from the Interims, so they have a chance to show that actual performance outweighs speculation and innuendo. If no bid materialises, it doesn't give "substantiation to NT suggestions". To my mind it would just confirm that it was never on in the first place, as I said at the time.

[squidsgone] 23/10/2018 15:48

Phillis,

Were you trying to answer the question in #2273? I was asking about how the BoD hoped to maintain or increase shareholder value from the 'share support' exercise.

[phillis] 23/10/2018 15:29

If no acceptable offer materialises the BOD will just get on with running the business -
the subsequent share price will be irrelevant
If somebody else comes along the asking price will be no cheaper and hostile bid s are rarely made these days

[squidsgone] 23/10/2018 15:09

jeffian,

Trying to understand your logic here.

How is it a share support exercise if the share price is likely to tank (on what will be seen as substantiation to NT suggestions), if no bid materialises?

[bouleversee] 23/10/2018 14:33

Perhaps we could get Melrose interested. LOL!

[jeffian] 23/10/2018 14:28

See #2124.

It's just as likely that this is a 'faux' bid situation cooked up by Standard Life and the Board as a share support exercise. OK, they've named a couple of hedge funds but there's no evidence that anyone is doing any serious negotiation, never mind DD ("...preliminary discussions are taking place with each of Apollo Global Management and Bain Capital which may or may not result in an offer for the Company"). My personal bet is that nothing will come of it, nor ever was likely to.

[dr_smith] 23/10/2018 14:05

IMO..and largely a guessed assumption, I dodn't think it was accounting irregularities but more a wish to tangibly see that core business was doing well, but with overlay of expansions/acquisitions it leaves it unclear to an outsider/investor.

All quiet in the meantime, nothing apparently happening - no doubt due to DD ..

... Day Dreaming ;-) .

In my limited experience, potential bidders do say when they decide not to proceed rather than wait for any default deadline action, as all parties don't want to waste time but curry on with life and normal business, so I am taking the silence as maintained interest and assume active talks still ongoing, meaning they are both interested, just a question of at what price - and perhaps one buying party waiting for the other potential buyer to make first move, in a negotiating game.

[googly1] 23/10/2018 12:26

This is not a hostile take over. The BOD have have opened the doors and invited both parties in to have a look at the books with a view to taking RPC private. You would hope they wouldn't have taken this action if there were any accounting anomalies as claimed by some parties. Unless the BOD are totally confident in their financial reporting then this is a high risk strategy and if no offer materialises this leaves shareholders totally exposed to a potential major fall in the share price thus leaving the company totally vulnerable to then being acquired on the cheap. IMO the credibility of the BOD is on the line.

[phillis] 18/10/2018 10:59

trading is in line with management expectations
are the debt markets closed - think not

PE will need a Board recommendation so they cannot afford to be too cheeky with their offers

It would be interesting to know where the management ( as opposed to the Non Execs)are positioning themselves in this

[squidsgone] 18/10/2018 10:08

hmm ... I wonder whether we should be expecting a fudge outcome here along the lines of, "not being pursued at this time due to volatility of prevailing market conditions"?

[phillis] 10/10/2018 16:17

Just spare me ( and everyone else) those fantasy posts!

[squidsgone] 10/10/2018 15:00

anyone want to suggest what Phillis needs .... ?

[cashcow5] 10/10/2018 14:55

we all need educating Phillis, even you ;)

[phillis] 09/10/2018 16:06

You need educating

[dr_smith] 09/10/2018 14:46

You have a condescending attitude Phillis.

[phillis] 09/10/2018 13:21

Smith
When you do DD you sign an NDA
You undertake neither to buy/ sell in the market for at least 6 months after DD has ended ( and certainly not during)

Basic stuff

[dr_smith] 09/10/2018 12:47

Well I'm from Cheshire too (Chester) and reckon...
Bidders total price not directly influenced by current share price * total shares, but future value to them, along with streamling, reducing duplication of admin/infrastructure and value generated from cross-selling.
As to whether s/h's accept any offer, then if share price is at a shorted low, then they may be more incliuned than otherwise to make a quick buck and accep..but I reckon that the volume will be non-PI's, insti's and like and not be swayed by an offer based on a set premium over share price for last x days trading, because they are likely LTH's too (by volume).
Agreed price will naturally sit in the middle, but not in the main be directly influenced by sh*rters share price suppression - that is just smoke.

Bear in mind, the current share price is what a few percent of total holding is being traded at, it does not represent what the remaining s/h's (90%+ say) value the shares at..and it is the majority s/h's that get to say yes or no.. but no doubt they won't have a direct say, it will be set up by BOD reccomendation of a proposal..whereby they may get nice bonuses.

Also..bidders could be buying shares on market.. I assume, on the cheap, so sho*rters would be subsidising their purchases.. unless there is a legal reason why they can't buy at mo', or perhaps could, but would be seen as hostile act?
...though if they don't get 100%, they won't be able to do planned streamlining/cross selling to justify actions.

Rambling thoughts... :-)
IMO :-)

[cheshire pete] 09/10/2018 10:04

Read in the DT that the deadline for the bid was the 'Takeover Panels' implying that it was not set by the company. Quite understand that DD for a company with recent rapid growth could take longer than 'the norm'. Trying to get my head round how the company can be valued fairly for both sides when there is a relatively large proportion loaned out to short sellers. Presumably, if they all had to close their positions tomorrow the share price would be a lot higher. Any help from my learned fellow posters would be appreciated....just a humble man from the plains struggling to make sense of it all.

[dr_smith] 09/10/2018 09:48

I said yesterday:
------------
On bids - in my limited experience, there are anouncements/offers by potential bidders by way of rns, to be considered by s/h and go to vote maority etc, I don't believe we are being kept in the dark pending such a price acceptance...but I'm guessing.
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And Phillis responded:
No Smithy
If there is to be a deal it requires to be recommended
No PE will launch an unagreed offer i.e. hostile
Thus the RNS - if there is to be one - will come from The BOD recommending shareholders accept an offer of £X
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I think we may be talking at cross purposes, I am referencing offers, whereas Phillis is referencing a deal (presumably, as in agreed).

I have been struggling to find the example a year or so back.
Possibly it was LRD.
The point I am making, is that on that occasion (be it LRD or other), we had an RNS for the offer from co A.
Target co (LRD?) put out response later that day, acknowledging receipt of offer of £ and said they are considering it .. etc.
Then there was offer (higher amount) by rns from co B, to which target responded in same was by rns, "considering".
Then several more bids from co A and co B accompanied by rns from both bidder and target co.

..So, it felt that negotiations were in the open, s/h new what was happening, unlike this one with RPC.

Why this one is different - I don't know..maybe because bidders need to know more about the business first, whereas in the previous case (LRD?) they had already done most of their homework, before breaking cover.

I am surprised the share price hasn't gone up more today...my Bat senses obviously aren't working right, so ignore my thoughts. ;-)

..oh and the extension can likely be extended, so we don't really know when to know what is going on. I wonder if Apollo and Bain know what each other are (will be ) putting on the table, as w/o rns and secrecy, they are presumably reliant on BOD telling them, but they could tease them with "we cannot disclose, but is somewhat higher than your bid".

Idle ponderings.. I'll sit and wait and be patient. :-)

Dave

[phillis] 09/10/2018 08:26

So RPC is a willing seller at the right price
Bit of an auction to come hopefully

[shauney2] 09/10/2018 08:09

Had a few from the off.A lot of stock on loan so a few will worry over the extension.