United Carpets Share Discussion Threads

[my retirement fund] 29/5/2015 15:45

Looking well bid again

[lbo] 27/5/2015 14:04

I think you will find private equity knows a lot more about exit routes then public markets! Just compare the cash returns on both.

[my retirement fund] 27/5/2015 11:50

Thanks for the 14p broker target LBO. Can imagine it higher once the FY and director statements released though.

RE post your 1607, I think you need to do some studying into what is meant by the term exit route.

[lbo] 26/5/2015 16:27

Exit route would be via increased cost savings,profits and dividends and some leverage. Private equity returns usually outperform the public markets. Even a trade sale could be targeted easier under private equity ownership. There is even a close link with Topps Tiles via former Director via Ray Tricker

[my retirement fund] 26/5/2015 16:18

Granted they could save up to say 200K but then again if saving such sums was critical they would have done it back in 2013.

Lets suppose they did take it private, where an earth would the exit route be then for the major shareholders including P Eyre?

[lbo] 26/5/2015 16:03

Yes but no minimum requirements in a private company unlike AIM. So you can at the very least half the cost of your Non-Execs by going private and removing one. Also less administration work as a private company as you don't have to meet all the AIM regulatory requirements so you can pay less.

And even saving £200k per annum would be £200k more in profits and dividends to shareholders in UCG. Its hard to defend the indefensible waste and costs for an illiquid undervalued microcap when it could add over 20% to current EBITDA making it even more undervalued?!

[eezymunny] 26/5/2015 14:54

Many/most unlisted companies have non-execs. Unreasonable IMVHO to include those as AIM related costs. Plenty of companies on AIM have quoted costs in the region of 200k.

[lbo] 26/5/2015 13:50

Depends on non-exec salaries! Anyone know how much total salaries are paid per annum in United Carpets?????

[eezymunny] 26/5/2015 13:38

£500k pa is nonsense LBO. A small company can do it for much much less. Comfortably do-able for 200k.

[lbo] 26/5/2015 13:19

The facts are still correct. How much does a NOMAD cost per annum? The cost of meeting Non Exec requirements and their salaries? Cost of AIM fees? Cost of a PR house? Costs of posting out accounts and results to shareholders and making RNS statements etc?





including associated Directors’ and professional advisers’ fees, this costs around £500,000 per annum

[envirovision] 26/5/2015 13:00

Note the date of that article. It was written just before the biggest bull run in small caps seen for the past 15 years!

What does that tell you about the author of that baloney?

[silkywhite] 26/5/2015 12:59

I was beginning to think you knew what you were talking about. Then you said that listing costs are 300K-500K which proves you DONT know what you were talking about. If that were the case then most of the stocks on AIM would delist tomorrow.

[lbo] 26/5/2015 12:54

And also lets not forget

L R Nominees Limited Des: Nominee at 3.8%
IF Bowness at 3.3%

would further reduce MBO cost if they supported it and why wouldn't they as it would increase profits and dividends fruther by removing the listing costs

[my retirement fund] 26/5/2015 11:43

Sorry no way I dont see a return of cash then a 15p MBO.By the time FY results have been released the market will probably be valuing it at 15p.

[lbo] 26/5/2015 11:26

The reason it was not taken private during administration is they honourably did the right thing by all shareholders! Taking it private now at circa 15p would also be the right thing as it would deliver nearer it's fair value and would reduce significant listing costs per annum and immediately add a couple £100k to the profits for management. And VCP is a manufacturer, supplier and distributor of carpets not a retailer like United Carpets so not the same business model. Also why are they paying dividends instead of doing a share tender or buyback? A capital distribution in that manner would have had a greater impact on the share price which they obviously do not want for some reason!

[my retirement fund] 26/5/2015 10:21

LBO, take a closer look at what vcp did, they returned cash it made little difference. Expansion in this area does not a great deal of money does it done correctly. Franchisee puts up majority store development costs etc.

The bottom line as always its not the cash in the business rather the cash the business can generate where the value is, which is why Paul Eyre is clearly not taking it private. Your putting up a hypothetical argument which is already discredited by the fact it was not taken private in administration on the basis of rewarding shareholders with decent dividends.

I think we are going to have to agree to disagree.

[lbo] 26/5/2015 09:48

"The way to make silly money is build the business up and sell your stake"Yes but they would rather return the cash to shareholders then try to "build the business up" again. That was the whole reason of the IPO a few years ago! Things did not work out for them on the economic front then and as you said now with a better economic climate they would still rather pay dividends then invest in the new format and "build the business up". I also see Vidacos Nominees have 10%. Maybe they will convince them to take it private at circa 15p and reduce the unnecessary listing costs of being a small illiquid dividend paying micro cap listed on AIM. This alone would add a couple of £100k to the bottom line at an already undervalued United carpets.

[my retirement fund] 26/5/2015 09:18

LBO I was in victoria carpets from £2 onwards and they paid out a special dividend of two third of the market cap. However from that point on they have simply used their credibility to make acquisition and share based operational improvements which have more than quadrupled the share price.

Major shareholders own excess of half the company and the exec chair Mr Wilding 50%.

Your theory is wrong LBO. Wilding could have taken the company private for a fraction of what its worth today.

The way to make silly money is build the business up and sell your stake. (For example), How do you know in a years time their small store format/no stock holding approach cannot be rolled out nationwide. We are entering a more mature phase of the recovery cycle, people are spending again on their properties and its clearly a decent format otherwise others such as carpet right on much higher multiples would not be trying to ape it.

[lbo] 26/5/2015 08:35

Between them Eyre and Grayson own47.3% and 15.4%

[my retirement fund] 22/5/2015 22:55

.....private equity smash and grab.