Trinity Mirror Share Discussion Threads

[cjohn] 04/2/2018 19:11

127m, some deferred and some paid off with dirt cheap TNI shares, plus 40m into the pension schemes of the two companies. So 167m in total.

It's an OK deal, but not stellar. It remains to be sen whether they can strip out enough costs to make it pay.

[twixy] 04/2/2018 17:50

If the terms are accurate,if seems like a good deal...even better if there are performance conditions attached to the milestone payments over the 5 years:

[s34icknote] 04/2/2018 15:33

News leaking on acquisition of express ! Sicknote

[twixy] 02/2/2018 16:32

cci - it's a closed period so directors can't buy anyway...then there is the ongoing discussions over S&N, which is price sensitive.

[cityconindex] 02/2/2018 14:14

Where can this share price manipulation end? If the Pension deficit is going to be reduced by 100s millions, why are directors not buying? And how come the share price is just drifing downwards? are they waiting for better prices? In past situations like this MM drop the prices so far to remove stop losses and then the prices leap.

[cjohn] 02/2/2018 13:45

I remember when I was first buying into this stock, maybe six years ago now, the dominant opinión on this board and others was that interest rates would "return to normal" soon or in a couple of years at the outside. Numerous compelling reasons were put forward as to why this would happen.


I can't remember a single poster who thought interest rates would go down further. Or indeed any of the many pundits who foresee economic developments.

So you may be right, Harry, or not.

[harry_david] 01/2/2018 20:38

Freddie to these points there is now talk of rising corporate debt requirements to finance a return to capital expansion in the US and Europe. And then Trump's tax cut is the icing on the cake.

[freddie ferret] 01/2/2018 19:29

From another thread, may interest.

JTCod
1 Feb '18 - 09:43 - 66348 of 66349
0 0 0
This is a fascinating document issued a couple of months ago by Wells Fargo Securities entitled

Who Will Buy All the New Treasury Securities?



Some items which stand out to me are:

Fig 1: forecast new issue requirement for 2018 and 2019 are double that of 2017
Fig 2: Net foreign purchases drying up after 2014. 2016 was negative
Fig 3: Only foreign private investors were positive in 2017. Foreign official was negative
Fig 4: China reduced dollar reserves by $1 Trillion in just 3 years

Conclusion: Higher Treasury Yields Ahead
“Issuance of new securities by the U.S. Treasury Department has trended lower over the past six years as the federal budget deficit has narrowed. However, issuance is set to jump in the next two years as the deficit starts to widen again, and finding willing buyers for all the new securities may prove to be a bit more problematic than it has been over the past few years.
For starters, the Federal Reserve is effectively turning into a net seller of Treasury securities as it takes steps to shrink the size of its balance sheet. Foreign central banks, especially those in Asia, were quick to snap up Treasury securities when their currencies were experiencing upward pressure vis-a?-vis the U.S. dollar and their FX reserves were swelling. We forecast that most foreign currencies will appreciate modestly against the greenback in coming quarters, which probably will lead to increased demand for U.S. Treasury securities from the foreign official sector, but a return to the rapid rates of reserve accumulation among those central banks that characterized the last decade does not seem likely.
That likely will leave the private sector, both domestic and foreign, as the principal buyer of U.S. Treasury debt. Demand for safe-haven assets spiked during the financial crisis, leading to a notable increase in demand for Treasury securities from foreign investors. Similarly, new regulations caused domestic banks to ramp up their purchases of Treasury debt, but those buying needs look to have been largely fulfilled. Short of another financial crisis, a surge in private sector demand for Treasury securities stemming from risk management considerations does not seem likely. So if demand for Treasury debt does not keep up with issuance, prices of Treasury securities will decline. Said another way, yields on Treasury debt must increase to clear the market. This conclusion is consistent with our forecast, which looks for yields on U.S. Treasury securities to rise over the next two years.”
JTCod
1 Feb '18 - 09:52 - 66349 of 66349
0 0 0
To add to the pressure the US Treasury debt ceiling needs to be raised by early April at latest or the Treasury is forecast to run out of money. Remember the previous stand-offs on this issue?

[harry_david] 01/2/2018 14:42

Good point cj. A 30 yr yield of 2.25% looks very possible to me in fairly short order.

[cjohn] 01/2/2018 09:19

hi Harry, you need to compare the current long-term gilt yield with the rate at the reporting date of July 2nd of the half-year results.

The current rate is about 0.25% higher than on the last reporting date. (It's about 0.5% off its lows of June and September.)

[harry_david] 31/1/2018 09:16

City index, I am right, just quoting management from last year.

[cityconindex] 30/1/2018 23:34

Harry if your calculation is correct coupled with an uptick in advertising then all the possibilities make for an exiting few months ahead.

That's a lot of deficit reduction, but its exiting stuff as the MM have yet to catch up.

[harry_david] 30/1/2018 16:01

When you think about it, buying Trinity is a better way of punting an interest rate rise than shorting gilts. No risk and one hell of a lot of leverage.

[harry_david] 30/1/2018 15:15

At last something to start some action. A half point rise in long interest rates reduces the pension deficit by £140 million.
Also the latest internet visit numbers could be a sign of growth there.

[cityconindex] 30/1/2018 14:48

Went to 76.4 to sell about 10.30,
Then straight back below opening price, Is it resistance or MMs slamming the price down? Any ideas?

[cityconindex] 25/1/2018 22:23

Freddie

Daily mail increase in advertising 2% Shares up about 40 pence,

I bet you wish you had now

[freddie ferret] 25/1/2018 18:30

Some may say this is not relevant here however they are a publisher both print and online and are doing ok.



Incidentally, I do not hold stock in HYNS.

[cjohn] 25/1/2018 17:45

Hi Snicker,

If Aviva thought disrupting the deal would benefit TNI financially - ie bad deal avoided - and that this would, hopefully, be reflected positively in the share price, then Aviva wouldn't be in a position to benefit, as they'd have sold out or sold many of their shares.


It's more likely they've decided they've made a wrong call in buying TNI. The potential deal is maybe a symbol of that for them: ie TNI is resorting to doubtful acquisitions.

I don't agree with their line of thinking. The acquistiion makes good sense.

In general, I reckon margins will be sustainable for TNI for longer than might be expected, precisely because of the lack of new competitors in a declining sector. (We might expect other dominoes to fall as well: Johnston Press??)

I remain on the sidelines here. Still a very complicated call, in my view.

Best of luck to holders.

[smicker] 25/1/2018 12:13

CJohn,
Any thoughts on whether Aviva have a strategy to disrupt this deal, hence the heavy selling?

[cjohn] 25/1/2018 11:59

Takeover of a declining asset makes perfect financial sense, provided they get a bargain price, given that it is a declining asset.

They have a decent record in stripping out costs from their own business and the acquired (and rapidly declining) Local World. And they should be able to repeat the trick with N and S.

[smicker] 25/1/2018 11:38

Interesting to see Aviva commenting. Ive no doubt most of the share price weakness has been due to them offloading.

[cityconindex] 25/1/2018 11:26

hxxp://www.hl.co.uk/shares/shares-search-results/d/daily-mail-and-general-tst-12.5p-a-non-voting

Daily mail figures taken well by the market increase in advertising may bode well for Trinity as well..Has the market turned?

[cityconindex] 25/1/2018 01:22

Article in DT warning not to overpay, makes total sense, 65 million all in take it or leave it. Fox needs to show his mettle at bargaining. Or walk away.
T
rinity Mirror shareholders have warned they are ready to oppose its planned takeover of the Express if the company agrees too high a price with the newspaper’s owner Richard Desmond.
Two top 10 investors in the publisher of the Daily Mirror have told The Telegraph that they could block the consolidation attempt by chief executive Simon Fox.
Both are concerned that Mr Desmond may extract too high a price from Trinity Mirror for the Express, the Star and OK! Magazine after more than a year of talks about the future of the titles. The Trinity Mirror board was due to discuss potential terms for a transaction today.
A bill of around £130m has been discussed, including a £40m contribution to the Express pension scheme. It is unclear what price is under discussion now.

Trevor Green of the asset manager Aviva Investors, the ninth largest Trinity Mirror shareholder, indicated that price would be too high given it is more than Mr Desmond paid for the Express and the Star. The newspapers' revenues from are down nearly 50pc in 17 years as print circulation and advertising sales have tumbled.
Mr Green said: “One thing which should be taken out the equation is the price Desmond paid in 2000 of £125m because the industry dynamics have changed materially since then.”

Those concerns were echoed by a fund manager at another of Trinity Mirror’s biggest backers, who said Mr Desmond’s publishing assets should cost the company “next to nothing”. He said that any price that valued them at a higher multiple of earnings than Trinity Mirror, currently at 3.2 times, would be unacceptable.
The fund manager added: “The maths on this have got to be so good that it is a tough deal to do. After all this time there would be no shame in walking away.”

Trinity Mirror chief executive Simon Fox aims to keep profits up by consolidating costs
The earnings of Mr Desmond's publishing assets are not made clear in public documents. They benefit from advertising spending by the Health Lottery, his National Lottery rival, which reports heavy losses. They also pay rent to £7m a year rent to Mr Desmond's property company.
Under the proposed terms revealed by The Telegraph in October, Trinity Mirror would pay a total of £130m including £60m in cash and £30m in new shares that hand Mr Desmond roughly a tenth of the enlarged company. The remaining £40m would be paid over three years as cost savings targets would be made by combining, printing, distribution and back office functions.
At the time a senior Trinity Mirror source said the company was “very mindful” of the risk of overpaying Mr Desmond but did not dispute the figures.

A spokesman for Trinity Mirror said this evening: “Our discussions with Northern and Shell are progressing well.
“The Board of Trinity Mirror will only recommend a deal to our shareholders if it is financially compelling and where we are confident of gaining their support".
Price warnings from shareholders come on top of concerns from pension trustees on both sides of the transaction, who face funding shortfalls. Trinity Mirror trustees have questioned the wisdom of taking on new debt to buy more declining newspaper assets. Express trustees have raised concerns that the deficit in their scheme will not properly attended to in the sale.
The two major Trinity Mirror shareholders said they support the rationale for newspaper consolidation, allowing costs to be stripped out as print sales decline to maintain profits and payouts to investors. One described the company’s £426m pension deficit as “a gun to its head” by trustees that meant a risk of “punitive̶1; conditions being attached to a deal with Mr Desmond to win their approval.
Trinity Mirror shares are trading at their lowest level since 2012, giving the company a market capitalisation of just over £200m despite its £220m takeover of the regional newspaper publisher Local World in 2015. That deal has helped Mr Fox maintain profits but has failed to improve the company’s long-term prospects in the eyes of investors.

Mr Desmond’s representative declined to comment.