The Local Shopping Reit Share Discussion Threads

[skyship] 27/10/2016 07:26

Intriguing - hopefully it will force Internos to offer a more proactive future; as I might well prefer them to the eccentric Soukup!
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27 October 2016

The Local Shopping REIT plc

The Board of The Local Shopping REIT plc (the Company) announces that it is in receipt of a communication dated 21 October 2016 from Mr Duncan Soukup of Thalassa Holdings Ltd, owners (through two different nominees) of 23.48% of the Company's issued share capital, indicating his intention to requisition a general meeting of the Company. No formal requisition has been served on the Company at this point though.

The stated purpose of the general meeting is the removal of the existing directors of the Company, Stephen East (the Company's Chairman) and Nicholas Vetch, and the replacement of them by Mr Soukup and an associate of his, Mr John Hutchinson.

The Company's Board had previously, at Mr Soukup's request, offered Mr Hutchinson a Board seat on certain conditions that preserved the independence of the Board so that other shareholders' interests could be secured. However, Mr Soukup has now declined that offer.

Your Board believes that the proposals indicated by Mr Soukup would be highly detrimental to the interests of shareholders in general, would destabilise relationships with critical stakeholders and would be very disruptive of the programme that the Board has in hand for executing the strategy approved by shareholders.

[hillofwad] 27/10/2016 07:18

We must have smelt something in the water yesterday .Let battle commence Lets not forget Vetch is a seasoned property professional.dealmaker and definitely more than able to fight his corner with Thal Lets hope the shareholders are winners

[badtime] 26/10/2016 21:31

Tilts...will you be pushing for a seat on the board? :)

[strathroyal] 26/10/2016 19:57

I'd be surprised if Internos have cherry picked and sold off the best properties as they won't receive any bonus if they don't exit above 36p. Also, looking at the Gallery, there appear to be at least a dozen bookies, a sprinkling of estate agencies as well as too many charity shops so an eclectic mix remains.

As for the sp, we can only guess why GW sold out, but isn't the price simply reverting to it's pre activity level? After all, it was 27p in May & June (pre Brexit) and only started to rise with the change in substantial shareholders.The half year results were out in May and no information has been provided since.

[tiltonboy] 26/10/2016 19:19

SKYSHIP,

I dont need to remind you that for every buyer there is a seller. The volume wasnt quite as heavy as it looks. There were a number of occasions where I took size off the RSP just below the offer, and then the MM took them off SETS. There wass a sizeable order on SETS and every time the offer was taken it was reloaded.

[redhill9] 26/10/2016 18:29

Skyship, fully agree with your opening remark about being happy with 34p.

I hadn't forgotten about the operating income (I mentioned it in my post) but am still skeptical about the NAV. Perhaps I'm being overly cautious due to the market not rating LSR at all these past couple of years. Maybe I'm starting to believe the market is telling us that the remaining value isn't as much as previous NAV's have indicated. We'll see.

[skyship] 26/10/2016 17:47

I suspect most of us would be happy with the oft quoted 34p; but as that is more than 15% above where we are now, happy to buy back the few I released in the 30s a couple of months ago.

Today saw 30 trades totalling 578k, with only 2 sales that I could discern.

Redhill - the 30th September NAV to be declared in December WILL be North of 40p. Have you forgotten the income as referred to by Gfrae above?

[hillofwad] 26/10/2016 17:11

Yes never been known for leaving much in the pot for anyone else. Maybe they have kept a few back but the majority of the portfolio is under £200k auction fodder and trying to lash these togther in a portfolio is diffcilut Any players would want a miniimm of 20% discount from NAV to make it worth their while I would have thought the best approach is to dispose of these indiviudally using local agents and hope that owner occupiers might pay a little more. 34 p seems to be the high water mark Com eon Souky raise the game and lets be off so we can do something worthwhile

[gfrae] 26/10/2016 16:32

hillofwad, Whateley appears to have done a very good deal for himself- leaving others high and dry.
I do not think you are correct about the juicy parts of the portfolio have already been taken. In fact I believe that if anything it is the opposite. They are well aware that they won't have any chance of selling a portfolio consisting of only the less saleable shops. I have previously asked them this question specifically.
The portfolio they have sold was a particular portfolio and consisted of all sorts, the buyer was not able to mix and match so far as I am aware.

[hillofwad] 26/10/2016 15:47

gfrae Although Grahame is no longer directly involved in day to day management or property disposals he been directly involved in the way this company is heading by virtue of the fact he had a 9% shareholding and the financial ability to have put this into play . A seasoned operater whose presence would have discouraged many players from entering the fray.Never been known to have sold short. Now he has removed himself the situation has changed


Although the secondary retail investment market is proving resilien the Local Shop portfolio has already done the rounds Its probable that the juicy bits have already been taken up with the rump of fairly dry material remaining I wouldnt expect any increases in valuation

[badtime] 26/10/2016 15:21

Lots of buying so I wonder who's offloading

[gfrae] 26/10/2016 15:07

Whateley has not been directly involved with the co for sometime,so doubt that he has any particular inside knowledge.
Yields on these type of properties have been falling,certainly in the south.So,I would assume that if anything NAV will have increased slightly. Certainly there will be 3 pence odd of recurring income sitting there in addition to the previous cash balance.
So,I would assume that including the recurring income the NAV will be between 46p and 50p.
If Internos can not find any one to buy them then I suppose we just end up receiving a 3p dividend p.a.
However,if Soukup thinks that he has a better plan then I think he could take the company over at around 36p for cash and shares.
I would exchange my LSR paper for Thal paper around 1:1. (Eg 36 pence of LSR for 36 p of THAL)

[hillofwad] 26/10/2016 13:47

The market for secondary retail investmensts has held pretty solid this year .The danger of course is that the properties have already been cherry picked leaving those dubious ones behind.I guess its safe to assume if offers had come above book valuation they would have seen an exit I agree with redhill that its probably looking south of
40pThe proeprties have done the rounds
The market has cast its eye and hasnt bitten Its worth holding on to find out whther Grahame was proving to be a deterrent .Something is likely to happen very soon

[redhill9] 26/10/2016 11:27

Skyship, my reasons for suspecting the next NAV will be below 40p include the knowledge that Grahame Whately sold out way below this figure, and the current share price suggests the market doesn't believe it will be any higher than 40p.

I'd be very happy with any NAV reported above 40p but am not confident currently, however much auction levels may have held up, as I wouldn't be surprised if the current share price is giving us a clue....

[tiltonboy] 26/10/2016 10:35

I've picked stock up at 27.775p this morning, then just under 28p. There is still stock on offer.

[hillofwad] 26/10/2016 10:32

Yes lets be honest a 20% discount to NAV seems to be a reasonable buffer for someone to shake this loose . I think that Grahame would have been the problem probably holding out for sometime for a much higher amount putting off would be suitors .Things are likley to come to a head sooner rather than later now Im happy holding for the time being but like Redhill keeping my hand firmly in my pocket

[skyship] 26/10/2016 10:32

"I'd guess the next NAV is going to be down below 40p"

Personally I don't see any reason for such a move. Auction values have held up since Brexit. At our tertiary level, especially in the Regions, we aren't affected by the valuation markdown of the SE primary sector.

[redhill9] 26/10/2016 10:18

Its possible to buy LSR this morning at 28p. The last NAV was 43p as at 31 March and there should have been some operating profit since then but at 43p the discount is 35%. I'd guess the next NAV is going to be down below 40p, but even so it looks a bargain.

Problem is, LSR has looked a bargain for quite a while with nothing happening...... I'm going to hold for now and try to resist buying more in the absence of any positive news.

[skyship] 26/10/2016 09:33

I gather we will receive a comprehensive update with the Finals in December (17th last year). If that fails to show a comprehensive plan to restore value to shareholders.....then time to be more proactive....packing out the AGM would be one good move.

It does look as though Internos have decided their bonus fee from achieving a high sale figure may not now be achieved, so best for them just to drag things out and suck out the fees. Hopefully the Finals Statement will prove that an unjustified fear.

I am prepared to wait it out until December.

[hillofwad] 26/10/2016 09:19

Thal were making a lot of noise about demanding a review of investment policy Lets hope they get this moving I would be happy for Thal to takeover at 34p to release the zombie fund or instigating a policy change shunting the individual properties out and reintroducing a dividend . Time for action The company is too small to warrant its own existence Grahame selling at 34p was a high watermark for me as he would have fought for the last penny

[badtime] 17/10/2016 20:47

Sp starting to drift...bit lower and i might pop back in

[cockerhoop] 06/10/2016 22:57

Think the dates a typo, he sold to THAL (according to their submission) on 8th Sept

[tiltonboy] 06/10/2016 22:44

He sold to THAL at 34p.

[gfrae] 06/10/2016 18:48

Do we know what price he sold at? I note that on the 8th of August the share price was 25p.