Another Edison report, nothing new, kind of puts all the latest info into one document. |
Zeta is now being merged/absorbed by UIL. Things are moving fast. Not that any minority shareholder would have much of a say in it anyway.
ICM must be laughing all the way to the bank with all these fees! :) |
Short note, basically Morton's post about the highlights in the AR. |
Thank you Morton, as a holder of ZDPs its good to hear they have a plan to cover outside investors. As the wheels inside wheels have been getting smaller |
 As we have highlighted before, within the Somers' portfolio is an investment in AK Jensen Group Limited ("AKJ") which comprises a platform for both traditional hedge funds and hedge funds trading digital assets. In addition, AKJ has issued tokens, a crypto currency, which have been sold to investors and hedge fund managers in the crypto platform. Valuing the token is difficult as few metrics allow comparability and the industry has not settled on a methodology we can readily adopt. While investors and hedge fund managers on the AKJ platform are buying AKJ tokens at EUR 0.37 the volume held by Somers would likely see a discount driven by lower liquidity opportunities and reduced fee discount benefits held by these hedge fund managers. Somers holds 75.0m AKJ tokens directly and holds further AKJ Tokens indirectly through its investments in AKJ group companies who in turn hold AKJ Tokens in treasury. Somers values these tokens at EUR 0.185 per token. Each EUR 0.05 represents £5.7m swing in valuation for Somers and £2.3m for UIL. Further details on AKJ can be found on their website and note 29 to the accounts. |
Well, I had planned to read the report tomorrow.
Thank you Morton for highlighting the juicy bits.
A logical end to the company, with Mr Saville and his friends & family owning indirectly 99.99999% of it (I hardly exaggerate) it had not been much of a PLC for a long while; better to drop the mask and own the whole of it.
Technically I would have held from the beginning (when it became UIL from Utilico) to the very end when I get my ZDP 2028 money. :) |
Bit more in that link Rik..'Given this, the logical conclusion is to work towards taking the Company private and cancelling its stock exchange listings following the redemption of the 2028 ZDP shares.The Investment Managers and majority shareholder both recognise this and have combined to put forward proposals, which the Board supports, to manage UIL over the next four years with a view to realising sufficient investments to enable the redemption of the ZDP shares and provide an opportunity for the UIL minority shareholders to exit.To facilitate this, it is the intention to simplify the platform structures. This is likely to result in merging the Somers and Zeta investment vehicles into UIL, thereby consolidating the investments of Somers and Zeta with those of UIL. Such proposals will increase UIL's asset base, although the external minority interests in UIL will decrease as a percentage of the shares in issue, owing to the UIL majority shareholder's current shareholding in Somers and Zeta. It is proposed that these consolidations will be implemented at NAV to NAV.As referred to above, it is UIL's current intention, in the absence of unforeseen circumstances, to maintain the annual dividend at 8.00p, payable quarterly.Furthermore, it is UIL's aim to provide each year, through a cost effective mechanism, the opportunity for minority shareholders to exit a significant proportion of their shares at a discount to NAV of approximately 20%. Starting in the second half of 2025, this will provide liquidity for minority shareholders before the 2028 privatisation and, in addition, UIL plans to continue to buy back ordinary shares and ZDP shares in the market. It is hoped that these steps will lead to improved liquidity in UIL's shares, provide improved choice for ordinary shareholders to exit, whilst maintaining an income yield to 2028, for those shareholders who prefer regular income. It also provides improved asset cover for the outstanding ZDP shareholders. |
'ZDP REDEMPTION
The redemption of the 2024 ZDP shares will take place on 31 October 2024.' |
It comes at a suspiciously perfect time.
Wheels within wheels:
I bet the $41M will be used to emit warrants that will be sold to UIL then used as collateral for Somers who will will borrow to lend back to Zeta that in turn will release them as dividend to generate the cash for the ZDP 2024 due at the end of the month. :)
Well, as long as I get my money on the ZDPs... who am I to ask where it comes from? |
Interesting RNS. I can never quite get a grip on anything to do with this Trust.
Is it wheels within wheels? |
Pretty sure the ZDP 2024 have been planned for redemption. The rollover would have happened far earlier anyway.
Expect some loans from Somers or other financial wizardry. Still, this is a planned event so they likely have something in mind. |
Expect they are waiting as long as possible to release roll details in hope curve keeps falling to make any roll offering more attractive |
2024 zero redeem at end of October. No announcements that I can see.
There's just about enough time left to roll them but given the 28's are trading at about 11% it would probably cost them say 12.5% which is uneconomic.
So, I assume they will not be rolled but redeemed. So, where's the cash coming from to redeem them. They currently have none so need to sell some stuff or it's bank debt or some of each. Selling down UEM looks like the best option. |
Same here vacendak. For us ZDPs the reduction in bank debt has been good to see.
Over the half year, borrowings from the Bank of Nova Scotia, London Branch ("Bank of Nova Scotia") reduced by £22.5m from £37.5m to £15.0m. As a result, total debt including the ZDP shares reduced from £139.9m to £121.9m over the half year period and gearing reduced from 83.5% to 71.3%. Since June 2022 UIL has repaid over £35.0m in bank debt and £52.3m in ZDP shares. UIL is set to repay a further £15.0m in bank debt by the end of March 2024. |
I am now only concerned about the cover for my ZDPs.
So, I also still read the news, RNS etc. but not as assiduously as I used to.
Indeed, rolling over the 2024 would be either dicey or very expensive. They should be fine with the repayment though. The only worrying thing is that the ZDPs used to be at a healthy premium months or even years before their redemption back in the days of cheap money. By 2026 interest rates should have abated. |
Thank you for posting this.
I still come to take a look at UTL once to twice a month but I'm not persuaded there is value here, until the gearing is reduced.
I cannot see how UTL can roll the zero's at any less than 10% at the moment so it looks like the deleveraging will continue for some time. |
Getting concerned about the talk regarding the debt and the delayed dividend payment. I assume this is to pay off the ZDP 2024 as, unless I have missed it, there has been no talk of rollover yet. I was going to redeem my 2024 ZDPs anyway.
It also sounds like the bank, Nova Scotia, is not willing to lend as much as before. |
Boiler plate, nothing new.
The only good thing is the mention that they have always repaid their ZDPs.
We all know why it is not working: Opaque, incestuous relationship between boards, directors, shareholders, ICM and the "platforms". |
Well, a Dirac is a spike as a mathematical function, is it not?
Up 214.1% in an infinitesimally small duration then it dissapears, hence the cut of 19.9%. :)
They are venturing ever deeper into "It is worth what we are telling you it is worth" territory with that move; making the discount now materially impossible to close as it is no longer linked to excess liquidity on the market but just investor trust in the NAV. |
Only at UTL. From the last factsheet.
The valuation of Allectus Quantum was increased by 214.1% due to continued progress against the business strategy by Diraq, its principal holding. However, Allectus Capital's carrying value was reduced by 19.9% over the month. |
I think I may now understand how UTL managed to sell so many millions of shares in UEM now. I could never figure it out at the time. Presumably to a Saville third party trust or some such that didn't have to declare the purchase.
I find it hard to see myself buying back in here again. |
It's kept going this long, hopefully you'll be fine.
Can't see me ever buying back into UTL. |
I just hope those things will carry on as they have so far when I let my ZDP mature and cash them in. No more rollover for me. |
Probably relates to how saville 'repaid' the 2022 zdp. Just look at last UIL 3 factheets. Miraculously selling assets to yourself can generate most of the cash to repay the ZDP. The fully drawn £50 million debt in UIL never changed in the period and the new names in UIL top 10 were investees in the 'platforms' |
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