Smc Share Discussion Threads

[pbracken] 15/10/2007 07:39

Small Talk: Auckeet looks up as SMC ponders lonely future
By Andrew Dewson
Published: 15 October 2007
Despite the fact that both companies are very much at the smaller end of the UK market, the proposed mergerbetween SMC and Auckett Fitzroy Robinson would have created the UK's largest architecture practice. But the talks were called off on Friday and, although Auckett investors may be relieved, the outlook for SMC remains bleak even if it is still in talks with a private equity buyer.

SMC has had an awful year, culminating in a grim profit warning in May that has sent the shares into freefall. The merger with Auckett could have offered it a way out of its difficulties but with more than £18m of debt on the books and the equity valued at less than half of its debt pile, the company is going to have to work miracles if it is to remain independent.

The word in the markets is that the potential buyer is none other than Stuart McColl, the founder of SMC and still its largest shareholder with 17 per cent of the stock. However, hewas ousted on the back ofMay's warning and given that the stock has fallen 80 per cent since then the chances of an offer at a significant premium to Friday's closing 15p per share price look very slim.

Auckett has a stronger balance sheet and although a successful merger between the two would have required an awful of work it appeared to offer SMC shareholders the chance to recoup a larger proportion of their losses than would taking the company private. The chances are that the talks ended because it would have turned into a merger in name only – with SMC teetering on the brink Auckett was undoubtedly the party in possession of all the aces. For investors, the choice is fairly straightforward – Auckett is in good shape and will likely outperform as a standalone entity now that is not sorting out SMC's woes.

Sensible investors are already out of SMC, and for anyone left in, the future looks precarious to say the least.

[sllab101] 13/10/2007 22:43

I said a few months back RPS are after this and they will be in the bid.

[chopsy] 13/10/2007 22:38

If Numis sold at 15p, someone must have bought them, so someone must be accumulating.

As I bought below 15p, 30p would be fine by me. Bring on the privatisation.

[cyberbub] 13/10/2007 20:24

If McColl gets support to buy the company back at these rock-bottom prices then he is not quite such an idiot as has been suggested many times on this thread!

I am newish to share-trading but it seem to me that this would offer us suffering PIs an opportunity to maybe make back some of our losses. AUK failed to agree terms so I suppose that McColl would have to offer higher than AUK, but I would not expect any offer price to be very high (maybe 30p?). Many people on here would still be making a heavy loss (me included). On the other hand we could refuse the offer in the hope that SMC will eventually pull round by itself and we might get back to something like 100p in 2-3 years time. I suppose this would require a co-ordinated approach by shareholder groups.

Is my interpretation correct?

Interesting couple of weeks ahead maybe.

[scburbs] 13/10/2007 12:28

An explanation of the real reason for Aukett pulling out? They weren't prepared to take on SMC's debt/contingent liabilities except at a very low price.

"Aukett chief executive Nicholas Thompson said: "It was a great opportunity that we couldn't consummate but no doubt there will be others. Financially we are a pretty healthy company and I have to protect that.""

[chopsy] 12/10/2007 20:36

How can Numis have sold at 15p yesterday? Must have been a private (off exchange) transaction, at well above.

[cool_hand] 12/10/2007 16:20

Almost dumped these when they went below 14pence.

Still at a heavy loss but things look better.

I would prefer to see a steady recovery than being bought out on the cheap.

[latifs100] 12/10/2007 15:13

those who were brave to top up at 12p.. well done

[spectoacc] 12/10/2007 10:56

Ticking up now.

[dave7] 12/10/2007 09:50

Look out y'all!! Plenty burnt fingers with this one-mine are completely barbecued...

[wapper] 12/10/2007 09:22

Good for SMC ...wouldn't sell out cheap to Aukett....trading to expectations..implemented turnround strategy...good recovery play. Risk/reward ratio very good IMO. Could see a very sharp upturn with next RNS ...just need to keep trading in line..nothing spectacular required.

[silverfern] 12/10/2007 08:41

what a buying opportuinity - for Aukett

[cambium] 12/10/2007 08:02

Blackstone saving face maybe!

[floppyjoe] 12/10/2007 07:28

SMC Group Plc
12 October 2007


12 October 2007

SMC Group Plc
('SMC' or the 'Group')

Offer update

On 8 August 2007, the boards of SMC and Aukett Fitzroy Robinson Group plc
('AFR') announced that they had entered into non binding heads of agreement
relating to a proposed merger of the two companies.

Today, the Board of SMC announces that it has been unable to agree satisfactory
terms with AFR for a merger and those discussions with AFR have ceased.

The Board of SMC confirms that discussions are ongoing with a private equity
backed third party for a potential offer for the Group. Shareholders are
advised that discussions are at a preliminary stage and that no offer terms,
including an indicative offer price, have yet been provided. There can
therefore be no guarantee of a formal offer being made for the Company.
Further announcements will be made as appropriate.

Further to SMC's interim results announcement on 27 September 2007, the Group
continues to trade in line with management's expectations following the
successful implementation of the recommendations of the internal review
committee.

-ends-

For further information please contact:

SMC Group Plc Tel: [phone]
Robert Boardman

Numis Securities Tel: [phone]
Stuart Skinner/James Serjeant

Bell Pottinger Corporate & Financial Tel: [phone]
Chris Hamilton

[jg1882] 09/10/2007 13:08

personally i thought results would have been the trigger but obviously that wasnt the case...bought at 19p pre results and after that statement didnt expect them to drift this much. Next catalyst a further trading update saying H2 on track or an announcement on long term funding etc.

[masurenguy] 09/10/2007 13:01

Quite a few buys today without any news as a trigger. There must be some positive information somewhere since it's hard to believe that this is just 'speculative' !

[spectoacc] 09/10/2007 12:35

Suspiciously well bought today; here's hoping. Although agreed if the merger doesn't go ahead, it's down to either the banks or a fundraising. £7m market cap here so fancy the risk/reward myself.

[marvelman] 09/10/2007 11:30

Actually NJP that sums up the whole situation....in a nutshell.

[njp] 09/10/2007 11:14

Marvelman

If it's good for AUK, it'll be because they got it at a knock-down price. However, if it's a good opportunity, I'd have thought SMC shareholders would prefer to go it alone, provided they have or can secure effective management and continued backing of the banks.

If SMC is still a basket case, then best for AUK to avoid it IMO.

Personally, I reckon there's a good business in there and ways need to be found to keep it going. Hence, I guess, the contact with Aukett in the first place.

[marvelman] 09/10/2007 11:08

If so NJP I would have thought this and AUK would have been going in opposite directions by now.I would like to see a merger/takeover though as it I do believe that the two could make a very powerful force...on the right terms.