Westside Acquisitions Share Discussion Threads

[rivaldo] 02/12/2004 18:51

Two nice buys totalling 500,000 shares today, including one T trade which has obviously been picking off small sellers. Perhaps another share buyback?

With an NAV of twice the current price IMO someone's got some sense.

[rivaldo] 23/11/2004 14:32

Yep. I also saw this:


Goals makes pitch to raise £20m on flotation
KRISTY DORSEY, Deputy Business Editor

My assumptions were wrong - looks like Goals are valued at £5m pre new money.

Interesting that the Chairman says there are "significant barriers to entry" - and also this: "The company, which says it is also profitable on a pre-tax level". So it probably barely makes any profit, but is valued at £5m. If The Elms were valued at the same ratio to turnover it could possibly now be valued at £1m as the £840k turnover figure was some time ago now.

It's possible that Goals might get busy with their "up to £20m" soon after flotation if we're lucky - I wouldn't have thought WST would want to carry on managing The Elms for ever having turned it around.

[mark c graham] 23/11/2004 13:43

Good spot, Rivaldo. This does provide an obvious exit route for WST from this rather strange business interest.

[rivaldo] 22/11/2004 17:26

An interesting new IPO was announced today - Goals Soccer Centres.

They're floating with a market value of £25m, as "a successful and established operator of 5-a-side soccer centres across the UK." They have turnover of £6.2m, operate from 11 centres and made £1.67m operating profit in the 9 months to September 2004.

By comparison, WST's 5-a-side business, The Elms, made a £38k profit from £840k of turnover last year. Two schools of thought I s'pose:

1 - Assuming Goals are raising, say, £5m, they're valued at over 3 times turnover. This would value The Elms at £2.5m (quite a high P/E though!) - 2/3 of WST's £3.7m m/cap, without the additional £2.5m cash or any of WST's investments.

2 - The Elms may well be an acquisition target for Goals post-IPO. From a quick look at the web sites it looks there's not much overlap between the two companies' sites.

[rivaldo] 10/11/2004 09:27

There you go - YRK is up 13p today. That adds another £250k or so to WST's NAV, or almost another 0.3p. NAV now around 7.8p?

[rivaldo] 09/11/2004 22:45

LOL Mark! Perhaps you can now top up at the bottom with equally consummate skill?

A 9% drop on £4k of shares traded is nowt to worry about. WST still trades at only 50% of NAV IMHO. If your above post is correct then WST is doing exactly the right thing in taking profits. And YRK has results out soon - any news could send it soaring and WST will follow - and I'd much rather have my funds in WST, which is by far the less risky of the two.

[mark c graham] 09/11/2004 14:24

Someone sold 4.5m shares in ADE today at 5.12p - well below the prevailing market price. WST must be the likely seller.

[mark c graham] 09/11/2004 13:48

It seems that I caught the top with consummate skill.

[mark c graham] 04/11/2004 12:45

rivaldo,

Thanks for your comments.

I believe that the CLS warrants are at 2.5p, so they only have time value at the moment. They are quoted, however, and I'm working off their quoted price (same for YRK and ADE warrants).

With regard to the discount, I'm comparing against the offer price, which seems to me to be the most appropriate comparator for anyone thinking of buying this stock.

Apart form this, the difference in %ages also arises because you are calculating the premium to current price represented by the NAV, whereas I was calculating the discount to NAV represented by the current price (a 50% discount is the same as a 100% premium, from the opposite perspective). On reflection, your way is more relevant to anyone buying this share hoping for a rerating towards NAV, and I have amended the header accordingly.

As to tax, it is clearly an issue, but I haven't commented because I don't have a good understanding of it yet.

[rivaldo] 03/11/2004 18:43

Nice thread Mark. One query - surely the NAV at 7.3p is 72% higher than the current 4.25p share price, not 37%?

It might also be worth pointing out in the header that there should be substantial capital losses from past investments during the tech boom, offsetting a large % (if not all) of the current profits when realised - I admit that I haven't got the full accounts to hand to check this.

With CLS going up another 50% or so today, do you know at what price the warrants are exerciseable?

Let's hope you regularly have to update the NAV in the header post....

[mark c graham] 03/11/2004 13:47

With apologies to simonevans who created the existing thread on this company, but I wanted one with NAV figures in the header that I can keep up to date.

[mark c graham] 03/11/2004 13:44

Offer price on 02/11/04: 4.6p

Income received since 02/11/04: nil

Bid price at 02/03/05: 5.75p

Return to date: +25.0%

NAV (my estimate) at 02/03/05: 8.2p

NAV premium to offer price at 02/03/05: 21%

#####################
Tip closed: 02/03/05.
#####################

Total return: +25%

Annualised return: 97%

#####################

Tip Reopened 20/05/05

Offer price on 20/05/05: 4.25p

#####################

Westside Acquisitions (WST) is an AIM-listed company that invests in, or acquires, early stage companies operating in the sectors of sport, technology and general investment.

There are currently 94.04m shares in issue, and the market capitalisation is £4m (@4.25p mid-price).

The investment case for WST is built upon: (a) the opportunity to buy cash and listed assets at a very large discount to their market price; and (b) the ability of the management to create additional value for shareholders by way of more deals of the type done to date.

There are three main contributors to value in WST.

Net Current Assets
----------------------------
As at 30/06/04 these amounted to £2,453k (£2,493k cash). That equates to 2.6p per share.

Football Partners Ltd.
-------------------------------
This trades as "The Elms" and is London's leading provider of 5-a-side football. It moved into profit in 2003, delivering £38k on turnover of £840k. I've valued it at 8 x profit = £306k. That equates to 0.3p per share. It is fairly cautious basis. But I am not convinced about the potential or the saleability of this business, and it has yet to demonstrate that it can deliver profits consistently. Encouragingly, the f2004 first half loss was significantly lower than last year's.

Reverse Take-over Investments plc (RTI)
----------------------------------------------------------
RTI acquires and develops share stakes in shell companies, with a view to negotiating the acquisition of target companies and seeking admission to a recognised investment exchange. WST holds three quoted investments through this route: Cheerful Scout (20m shares [CLS], 1.5m warrants [CLSW] exercisable at ?); York Pharma (2m shares [YRK], 450k warrants [YRKA] exercisable at 50p); and ADDleisure (21.54m shares [ADE], 3.77m warrants [ADEW] exercisable at 5p). Based on current mid-prices, these are valued at £4.1m, that is 4.4p per share. This makes no allowance for any unquoted investments held by RTI.

Thus, total net asset value is 7.3p per share, some 37% higher than the current share price. Any potential for the WST business model to deliver further value to shareholders is additional to this.

Buyers take an immediate hit of almost 20% on the spread, so anyone buying in should be doing so from a long-term perspective.

Update 28/02/05
------------------------

The soaring value of YRK has sent the NAV still higher. Breakdown of NAV per share by asset is given below.

Cash : 2.62p (32%)
FPL : 0.33p (4%)
CLS : 0.31p (4%)
YRK : 3.89p (48%)
ADE : 1.04p (13%)
-----------------
Total : 8.18p

[rivaldo] 02/11/2004 15:49

Agreed in theory - but (without the accounts to hand) WST must have lots of capital losses to offset from all the past dud investments. I'd guess that most of any current capital gains would therefore be tax-free, so an NAV of around 7.5p would still stand.

[mark c graham] 02/11/2004 15:18

I'm not so sure about CSL warrants, but it has 450k YRK warrants at 50p. Bear in mind that you should probably allow for CGT costs when calculating the net asset value.

[rivaldo] 02/11/2004 14:53

I see CLS is up 50% today! With 20m shares WST's interest is worth another £100k today. With ADE and YRK both steady at 6.75p and £1 I still reckon WST's NAV is at least 7.5p per share, i.e 75% over the current mid-price.

I believe WST has some CLS warrants as well?

[topvest] 27/10/2004 22:25

NAV about 6-7p by my reckoning. Happy to hold. Another couple of RTO's and this will be looking very attractive. York Pharma is the best deal so far imo, then ADD, then CLS. All good quality deals imo..better than many new issues on AIM. The quality of the deals that WST are putting together is not in the share price imo.

[rivaldo] 27/10/2004 08:30

From Citywire today:
DAILY EXPRESS
* Rumours of a lucrative deal lifts ADDleisure

ADE's price is down today, but at 6.5p WST's 21.54m shares are worth £1.4m. Plus the 3.77m warrants are worth another £50k!

[topvest] 26/10/2004 20:25

ADDleisure up a penny today. Looking good!

[responsible lad] 26/10/2004 10:21

CLS will recover. My mate in the city is telling everyone to buy into them today.

[mrm12] 26/10/2004 09:07

limited to 15000 shares via Barclays @ 4.75

[canford cliffs] 26/10/2004 09:04

nice tick up - 5p within range.........

[rivaldo] 26/10/2004 08:40

Nice to see a decent tick up on the bid on just £700 of buys! (unless there are delayed trades to come).

Topvest, do you agree my NAV of around 7.5p? If CLS and ALT were to recover as well then we'd be in clover...

[topvest] 25/10/2004 20:11

20m shares in ADDleisure are worth c.£1.2m versus the £100k originally invested. Now that is a reasonable return!

2m shares in York Pharma are worth c. £2m versus the original investment (£100k again). 450,000 warrants worth another £0.2m.

These two investments are worth most of the market value of WST before today's rise.

CLS also the top riser today and they have 20m of those.

Strategy starting to pay off!

[canford cliffs] 25/10/2004 11:34

shamster - what warrants?

thanks