Uil Share Discussion Threads

[morton2011] 10/10/2019 09:47

@SpectoAcc. Cash is the most obvious reason. UIL maxed out on its overdraft so where is the money going to come from. I suppose if it makes them realise some of the assets to fund this then that would be positive but it should be in the illiquid ones like selling � million chunks of Somers or Zeta or Allectus etc which would then make clearer as to their valuations for these 'platforms'.

Buybacks has not worked for ICM with Zeta. They now control well over 90% after buying back shares, the discount is persistent and there are now issues around valuations.

New non exec for UIL seems a good appointment for the smaller shareholders as no obvious ties to ICM btw and he is in charge of audit.

[spectoacc] 10/10/2019 08:34

@Morton2011 - any reason they'd stop buying back tho? They've said 20% discount target, my understanding is that they'd roughly seek to maintain that, rather than get there, then let it slip out to 40% again.

[morton2011] 10/10/2019 08:33

@pherrom. Russian Roulette with the buyback strategy as well. Once they stop buying the discount will widen as nothing else has changed.

[spectoacc] 10/10/2019 07:02

Lol @pherrom.

[ceaserxzy] 09/10/2019 19:45

Have taken half of my holdings here off the table, bought between 150 to 175 pence. The discount is still high compared with other ITs but relatively low compared to its own history. Future performance will depend on its NAV performance and the buyback to lower the discount to around 20%.

[pherrom] 09/10/2019 18:53

Over 99% in favour of the move to the Specialist Fund Segment, not unlike a Russian election.

[morton2011] 27/9/2019 08:51

odd news out of the ASX overnight. Zeta shares been suspended at its request. Maybe worth noting that the unlisted investments in Zeta increased significantly when ICM shuffled its pack and moved Axelrock (a shell owned by Duncan Saville of all unlisted investments) into Zeta in 2017.

hxxps://wcsecure.weblink.com.au/pdf/ZER/02152010.pdf

clipped from that:

REQUEST FOR VOLUNTARY SUSPENSION

Pursuant to ASX Listing Rule 17.2, Zeta Resources Limited (“Zeta” or “the Company”) requests that trading in the Company’s securities be suspended from the commencement of trading today.
For the purposes of ASX Listing Rule 17.2, Zeta provide the following information:
1. The Company will be unable to lodge its statutory financial accounts for the year ended 30 June 2019 by 30 September 2019 (Statutory Accounts). IFRS 9 requires that the Company's unlisted equity investments are valued at fair value through profit and loss. The Company has a difference of opinion with its auditors in
relation to the methodology of obtaining fair value for its unlisted equity investments. The Directors note that certain valuation approaches will require the Company to release information to the market in complying with its disclosure requirements that may not be at an appropriate quality level, or that it may
not be able to obtain from the investee companies.

2. The Company is working diligently to resolve the difference of opinion in order for its Statutory Accounts to
be lodged as soon as possible and expects that the suspension of the Company's securities will continue
until its Statutory Accounts are released to the market.

3. The Company has appropriate systems in place to comply with its reporting obligations under the Listing
Rules on a timely basis and has a sound record of ASX reporting. It is confident that its reporting obligations
under the Listing Rules can be met on time in the future.

4. The Company is not aware of any reasons why the voluntary suspension should not be granted or of any
other information necessary to inform the market about the suspension.

5. The Company expects to be able to update the market by 18 October 2019 about the timing of completion
of Zeta’s audit.

[vacendak] 20/9/2019 09:47

Still going up right now.
The 52 weeks high to beat is 258p.

[spectoacc] 20/9/2019 08:38

A 60k director buy at 248p reported after close yesterday I see - he's getting more before the co purchases push it up! :)

[spectoacc] 18/9/2019 08:55

What got me back in - and what I found intriguing - was:

"Accordingly, the Board intends to focus on reducing the discount of the ordinary shares, targeting a discount to net asset value of approximately 20% over the medium term. "

Plenty of words to play with in there:

Intends
Targeting
Approximately
Medium term

And it's on a notoriously choppy NAV. But - that would imply they'd buy up to c.302p, or be looking to push it there over time. That's got to give a floor of sorts, albeit the NAV will move around and "medium term" is ambiguous.

But I fancy selling again c.50p higher than here, even without any further movement in the NAV.

[topvest] 17/9/2019 13:13

I suspect there will be a very steady increase in the majority holding over the next 10 years. That way everyone will be a winner, particularly Saville and Jilling who always take the cream on top, and probably deservedly so. Let’s face it they probably don’t have the spare cash to buy out the minority themselves, so there is no rush when they are also taking enormous salaries with the status quo as investment manager. They can effectively get to 90% without paying a premium. Whether ordinary shareholders will ever get book value for their shares is the big unknown.

[vacendak] 16/9/2019 20:25

Indeed.

I have held long enough (without investing recently) for not only the gains to overcome the cost of buying, but for the collected dividends to do so too.
So, I could just lock in and collect the divi until the end (my end or the end of UIL Ltd, whatever comes first), telling myself that even if I cannot sell, I am not losing anything.

On the other hand, this is a significant slice of my portfolio, and I always say to others that shares are more liquid than a house, cannot sell the living room on its own, etc... and that slice would be hard to liquidate.

Good point about the dealing costs too, I need to ask Equiniti/Shareview about those.

The scenario you mention of buy-back, redemption of ZDPs and ultimately buyout of the small holders in the future has also been at the back of my mind since the first RNS about the move to Specialist Fund Segment as in delisting/going private via management buyout.
So, holding on until being bought out (at least at NAV) may become my choice.

For the ZDP hypothesis, we shall know soon as they would need to rollover the 2020 way before October 31st, 2020. I have not read the latest report yet, but I will look for an annoucement about this in the pages with a grey background and small typeface near the end.

I recall them creating the 2026 when rolling over the 2018 to lenghten the duration of the tranches from six to eight years, rolling over the 2020 to ZDP 2028 and not 2026. Thus, it would be unlikely for them to redeem them before folding.

Note that the ZDPs are from UIL Finance Ltd, a separate company, nothing would forbid them to fold UIL Ltd with a buyout of the last 25%. The ZDPs could still be there.

[topvest] 16/9/2019 19:53

Its a tricky one here isn't it? Management are very trustworthy and you wouldn't bet against them achieving £5 NAV in the next couple of years. However, control is creeping up with 70% owned by the majority shareholder. Buy-backs will continue to boost returns, but what happens at the end? I suspect it will have to keep going until all the ZDPs are redeemed at 2026 at which point ordinary shareholders may get bought out. I've been tempted to add a few more and may do so before the move to the SFM. The SFM is OK, but dealing costs are £25 versus £11.50 a trade. Totally ridiculous as the SFM is much lower risk than the AIM casino!

Another thing to bear in mind is their ages - Jilling's is 64 and Saville 61 so their investment horizon is possibly not as long as ours!
What I think this is heading for us is lower leverage and a wind-up in 7 years' time. I'm tempted to buy a few more actually, but will wait until next month or November.

[vacendak] 16/9/2019 15:04

The RNS about shifting to the Specialist Fund Segment.



Good thing that the not-friends&family-of-Duncan-Saville will see their votes counted separately. The 75% have already announced support; but at least 50% of the last 25% need to vote in favour, so 12.5%.

They have taken a leaf from Project Fear to scare us into voting in favour.
Doing nothing means that the minimum threshold will be crossed sooner or later (nothing forbids the directors to buy). If it happens while UTL still trades on the Premium Listing, UTL will be expelled and we will no longer be able to trade our shares.

Once on the SFS, expect the spread to widen even more as the Chairman's letter implies. So, roughly speaking, we have until end of October to unload our UTL on the market if we want to exit at today's spread. The switch is for November 6th.

The share price might go up, with the promised reining in of the discount at 20%; but liquidity will surely be hit badly once on the SFS.

[morton2011] 02/9/2019 16:13

gearing only going down because the Gross assets going up..the actual bank debt is the same as beginning of the year.

APT posted some very good reading results last week.

[spectoacc] 02/9/2019 16:04

Thanks @v.

[vacendak] 02/9/2019 15:32

July factsheet


Officially up by only 8.8% NAV-wise, the big spike was in early August after all.

All the rumours and updates from the latest posts are put in the factsheet:
Resolute up by 33%, good show for UEM, the proposed resolution to shift UIL Ltd to the Specialist Fund Segment and the associated desire to rein in the discount at 20%.

Somers and Allectus were down. Allectus is getting mentioned more since it entered the top ten investments.

The Blight Resources takeover has gone through, we held it through Zeta, which owned it at 87%. This is not a cash deal, Zeta now owns some Saracen Miberals Holdings (Australian gold miner). It must have been a positive move since it is reported.

The gearing is still going down slowly, now at 60.6%.
This is despite the recent offloading of ZDP 2026 that were held in treasury.

[vacendak] 12/8/2019 11:19

Back to the cum-income/ex-income discussion about the NAV from a couple of posts ago:



The gap has narrowed back to what it used to be, or in other words, the discrepancy has gone away.

[spectoacc] 01/8/2019 16:08

Thanks @v. Was the RNS re discount target that got me back in, though it's not without some curious points:

"Accordingly, the Board intends to focus on reducing the discount of the ordinary shares, targeting a discount to net asset value of approximately 20% over the medium term."

Why 20%? Why not 5%? 10%? 50%?

"Medium term" - could that be any more vague. Short term is soon. Long term is never. Medium term?

Still - pretty happy so far, tho cursing not having bought more ;)

[vacendak] 01/8/2019 15:48

@Specto
Welcome back.

The discount is slowly closing at 37.36% with the NAV at 402.28p as of yesterday. It has closed by 757 bp since last week.

The NAV is still going up, but not as fast as the share price

[spectoacc] 31/7/2019 16:31

Back in these after a good while out. Been some interesting director buying reported- not just for the size, but the height. They'd have done better off buying them when I did ;)

[morton2011] 31/7/2019 07:56

Resolute in large acquisition today, its ICM not UIL who gets the mention in the RNS despite UIL owning the shares, typical!

"Resolute's largest shareholder, ICM Limited, is strongly supportive of the Transaction. 94% of Toro Gold shareholders have signed commitments to accept the takeover offer and all required regulatory approvals have been secured."



Sounds like a good deal

[russman] 30/7/2019 06:58

But it is still a positive signal to shareholders that the BoD are looking at options to narrow the discount. Of course ICM gang could always sell down / tender some of their holdings.

[vacendak] 29/7/2019 14:54

Still going up.
A lot of trades today again, although the spread remains significant (4.2%).

Yet, still 160p+ to catch-up with the NAV.