Remove ads

Introducing the LemonFools Personal Finance Calculators

Staffline and Baronsmead offer

Sophisticated and complex high-risk tax-sensitive investments in small companies: handle with care
Tigger
Posts: 10
Joined: November 4th, 2016, 3:21 pm
Has thanked: 14 times
Been thanked: 3 times

Staffline and Baronsmead offer

#197817

Postby Tigger » January 31st, 2019, 8:27 am

I have a chunk of Baronsmead and subscribed for a little more in the current fundraising (despite the recent ownership change).

Looking at the disaster that was Staffline yesterday (down 33% after results were delayed, then suspended, then the reveal that accounting irregularities are being investigated), I was wondering what the implications were for the current fundraising.

The number of new shares issued are governed by the January 2019 net asset value. But Staffline accounted for 5% of NAV as at 30 September 3018.

Staffline shares have fallen from 1250p to 780p (pre-suspension) so that could knock their share of NAV to 3%, but that could still be overstated if the worst were to happen.

Looks like Octopus are a major holder of Staffline as well, owning 17% of their shares.

Unimpressed!

barchid
Posts: 49
Joined: November 30th, 2018, 2:18 am
Has thanked: 35 times
Been thanked: 18 times

Re: Staffline and Baronsmead offer

#197878

Postby barchid » January 31st, 2019, 11:02 am

Tigger, I agree, very unimpressive !
Octopus, with their enormous fundraising each year, are probably short of good ideas to park their cash, hence 17% of a stock like STAF. Baronsmead, with 5% of their nav in STAF should surely issue a supplemantary prospectus as this is a significant event, I would have thought ?

Vulgaris
Lemon Pip
Posts: 59
Joined: February 11th, 2017, 7:14 pm
Been thanked: 11 times

Re: Staffline and Baronsmead offer

#198313

Postby Vulgaris » February 2nd, 2019, 6:54 am

Prices were well below 780 immediately before suspension. I cleared out my last 1500, held directly and bought in the 200-400 range, at prices of 678 and 653.... I couldn't sell 1500 in one go. That was at 1.30 PM and there was no bounce-back before the 3.15 announcement

james188
Lemon Pip
Posts: 85
Joined: November 6th, 2016, 7:16 am
Been thanked: 36 times

Re: Staffline and Baronsmead offer

#198316

Postby james188 » February 2nd, 2019, 7:27 am

The one crumb of comfort for new subscribers in BVT is that the NAV for the purposes of allotment next week has not yet been announced. I am expecting that it will be lower than the currently published (January) figure, as a result of the STAF carnage.The prospectus tells us that the NAV will be announced next Wednesday and will be the figure calculated as at 31 January. The STAF shares had been suspended from trading at that time. Obviously of much less comfort for existing holders and something else to talk about at the forthcoming AGM/presentation.

Tigger
Posts: 10
Joined: November 4th, 2016, 3:21 pm
Has thanked: 14 times
Been thanked: 3 times

Re: Staffline and Baronsmead offer

#198381

Postby Tigger » February 2nd, 2019, 1:23 pm

Thanks all. I can see the last price was 780p on Google Finance but the LSE website has it at 670p instead. It's the latter value that they'll use I guess.

I will certainly be watching on Weds for that NAV announcement!

james188
Lemon Pip
Posts: 85
Joined: November 6th, 2016, 7:16 am
Been thanked: 36 times

Re: Staffline and Baronsmead offer

#198395

Postby james188 » February 2nd, 2019, 2:36 pm

The suspension price was 670p and I guess that that is the default valuation option, but I actually think that the BVT board and the Nomad have quite a difficult decision and one that they will feel uncomfortable about.
I say that because of the time that it took after the announcement first thing in the morning that the results were being delayed until share dealings were actually suspended late that afternoon. Why it took that long is beyond me and it will probably be some time before we find out why (if we ever do). In the meantime, the share price went into freefall, although the scale of the problem was not clear - and it still isn't. So it could be argued that the scale of the drop has been overdone, but until the company makes a further statement, no-one knows.
I did start to wonder whether BVT would delay the first allotment for a few days, assuming that STAF will clarify the scale of the problem soon and the shares can resume trading, but that isn't easy either, because the shares due to be allotted next week are entitled to the early March dividend payment. I imagine that some heated discussions are taking place.

barchid
Posts: 49
Joined: November 30th, 2018, 2:18 am
Has thanked: 35 times
Been thanked: 18 times

Re: Staffline and Baronsmead offer

#198446

Postby barchid » February 2nd, 2019, 6:48 pm

James
Very salient points you make !
Given that 5% of NAV was in STAF you would think that Baronsmead should have a good idea of the issues, otherwise why pay them a management fee ?
Hopefully this will not go the same way as CAKE, but the longer the wait that there is for answers does not augur well.....

Tigger
Posts: 10
Joined: November 4th, 2016, 3:21 pm
Has thanked: 14 times
Been thanked: 3 times

Re: Staffline and Baronsmead offer

#199052

Postby Tigger » February 5th, 2019, 12:40 pm

Jan 2019 NAV announced this morning and is 81.85p, which is just 0.6% lower than the 82.32p for Dec 2018.

No reference to Staffline in the release, so it's not clear what value they have used for it and therefore whether the recent decline has been reflected.

I guess it's possible it's been more or less cancelled out by higher valuations in the rest of the portfolio, given than January was a pretty good month for the stock market.

Tigger
Posts: 10
Joined: November 4th, 2016, 3:21 pm
Has thanked: 14 times
Been thanked: 3 times

Re: Staffline and Baronsmead offer

#207130

Postby Tigger » March 12th, 2019, 9:07 am

Just thought I'd circle back on this one as Staffline has returned to trading this morning and its shares are back up to 850p or so.

It looks like the additional costs may be limited to £3.5m and came from minimum wage violations. Hardly an episode that covers management in glory but not as bad as it could have been I suppose!
https://investegate.co.uk/staffline-group-plc--staf-/rns/group-update-and-restoration-of-trading/201903120730045214S/

Tigger
Posts: 10
Joined: November 4th, 2016, 3:21 pm
Has thanked: 14 times
Been thanked: 3 times

Re: Staffline and Baronsmead offer

#222524

Postby Tigger » May 17th, 2019, 5:33 pm

Here we go again. Staffline down 60% today after a big profit warning although seemingly unrelated to the previous problems.

I reckon that this could have reduced NAV by 1.8p from April's 82.2p.

Am expecting the interim results in the next couple of weeks so this may make the accompanying dividend a little less generous. Ho hum :?


Return to “Venture Capital Trusts (VCT's)”

Who is online

Users browsing this forum: No registered users and 3 guests