Synthomer Share Discussion Threads

[dr biotech] 08/9/2023 22:58

Not a current holder here, held these way back as Yule Catto and been off & on the watchlist since. I’ve kept a theoretical portfolio of every company that has raised money via rights issues using the primary bid platform - only 4/21 are above the rights price, average loss is 15%. Only real winners are AOworld which is up 100% (pantheon also significantly up).

Would you buy these shares just on valuation? I probably wouldn’t. But good luck either way

[gstarkey] 08/9/2023 22:36

Totally agree. Board is dysfunctional having masterminded shareholder value destruction on an industrial scale and I’m astonished major shareholders have not demanded Board change as a pre-condition to stump up more cash. Alarm bells rang when they declared a dividend they subsequently had to cancel. They have a track record of unjustified optimism. Post the rights issue, projected leverage will still be high and any shortfall on EBITDA would require yet another equity raise.

[nomolos1] 08/9/2023 20:35

Could be - or shorts closing for a nice profit.

[mrminister] 08/9/2023 13:42

Hi vols today & over 6% up ....can only mean people see value at this price and are coming on board ...

[tayle] 08/9/2023 10:35

If there is going to be no recovery in their markets by year end what's to say that Q1,2,3 and 4 24 will be any better ?

[wigwammer] 08/9/2023 08:49

Hmm. No hint of a cash raise in the previous statement. Executives were buying shares in the 70's, thus encouraging others to do the same. Then suddenly those "in the know"start selling down from 82p. An asymmetric market caused by abysmal communication by the company. Along with buying other companies at great premiums, and selling their own shares now at a massive discount, this has to be one of the worst managed companies I have ever come across in decades of investing. The one Individual who has been at the heart of all of it over the last 5 years is Chair, Caroline Johnstone. Will she be doing the right thing and stepping down?

[darrin1471] 07/9/2023 22:37

and those 350 new shares should be trading around £3 each

[libertine] 07/9/2023 18:36

You hold shares 1000
Consolidation 1 for 20 50 New shares

Rights 6 new for 1 new 300 Rights to New shares at 197p per share
Total cost £591

New holding 350 New shares

[reddirish] 07/9/2023 17:37

Sorry, 1367.

[reddirish] 07/9/2023 17:37

Have a look at my post 1637.

[t_headder] 07/9/2023 16:41

Anybody planning to sell after qualifying for the rights issue?

[pj fozzie] 07/9/2023 16:14

I'm have a hard time getting my head around the news. Can someone who understands, explain in simple terms what it will mean to me.

Say I have 1000 shares currently, valued at £450 at current prices.

What will I have to pay to take up the issue (and what would I end up with)?

Verses what would be the end result if I did not take up the issue?

Thanks,
PJ

[reddirish] 07/9/2023 14:59

Yes, I'm out too. I had only been holding on in the expectation that this would attract a take over bid, and that may indeed still happen. But I have done as all of us should do (lesson to myself) and today reviewed this as a new investment. As my conclusion was 'far too high a risk' the only conclusion was to sell. My biggest ever loss. I'm still up year on year, but only because I hold a massive position in BUR. Now I'm reconsidering my appetite for risk on that one!

[darrin1471] 07/9/2023 14:47

wigwammer. Your numbers match up with mine.
I have these on a watch list. More complicated, with more variables than I normally like. I will let the dust settle and do some more reading.

[wigwammer] 07/9/2023 12:48

Darrin - there is a decent conversation about this over on the LSE board, in particular the contributions by hereshopin are worth reading. My take is there will be 164m shares post rights, the current price equates to a theoretical ex rights price of around 292p and a market cap around £480m. That's a couple of hundred million higher than yesterday, but you have the benefit of a £260m net debt reduction... ATB and DYOR etc

[darrin1471] 07/9/2023 12:24

If I bought 10,000 shares today at 42p it would cost me £4200.
Consolidation of share 20 to 1 would leave me with 500 shares worth £8.40 and the total value would remain £4200
6:1 rights issue at £1.97 would mean I could buy (6 x 500) 3000 at £1.97 costing £5910
I would end up with 3500 shares costing £10,110.

Current shares in issue 467m x 42p share price is a mkt cap of £200m
467m shares consolidated at a rate of 20:1 would be 23.35m
23.35 x 6:1 rights issue would be 140m new shares issued as per announcement

As of 8am 26/09/23 shares will be consolidated 20:1. I will end up with 500 shares trading at £8.40 (current price 42p x 20)
If I still hold shares at the close of business of 26/09/23 I will be entitled to the 6:1 rights issue.
On opening on 27/09/2023 share price will fall to £2.88. (((£1.97 x6) + £8.40)/7)
I would have 3500 at £2.88 = £10,800

Valuation would obviously change with share price

I am not in my comfort zone here. Does that sound right?

[al101uk] 07/9/2023 11:54

I'm out too, for big percentage loss. I should have sold when it was clear that the acquisition had been a spectacular failure. Instead I convinced myself that it would come good when the cycle turned and I could just sit on it until then. £700 million of debt... WTF was I thinking!

[wigwammer] 07/9/2023 11:47

Agree to an extent. It's not clear how "in the loop" he was. But the Chair - Caroline Johnstone - has been there throughout the whole mess...

[tayle] 07/9/2023 11:37

I'm out! Biggest ever loss, I should have known better, let the trend be your friend. Last dividend was a decent payout then all it has done since is make lower lows 😡