The Lemon Fool

https://www.investegate.co.uk/hygea-vct-plc--hyg-/gnw/hygea-vct-plc---circular-posted-and-notice-of-g---/20171215144748H6567/

Quite a lot to take in here.

There will be a new B class of share with a generalist mandate managed by Seneca. The existing ord class will continue to be self managed. Seneca will handle all the admin and as a dowry pay the ord share running costs for 3 years.

In passing I note that the new potential manager, Seneca, has Bob Holt of Mears who in turn has Peter Dicks of Foresight VCTs on his board. Holt was also on Unicorn AIM with Dicks and Jocelin Harris of Foresight VCT. Unicorn Aim took over Rensburg AIM so Seneca may have some useful VCT contacts.

At a quick estimate Seneca are effectively paying 3 years of £129k of running costs (3 years free to Ord shareholders) or say £400k with inflation to get in which is cheaper than a new start-up. Looking at it another way Seneca are paying 3 times 2.3% pa of existing net assets or say 7% which is quite high.

This is a good deal for Hygea and is the continuation of a trend for EIS or other wealth managers wanting to enter the VCT world. We have seen purchases by Mattioli Woods of Amati Global, Draper Esprit of Elderstreet Investments and most recently Gresham House of Hazel Capital.

.....managed by Seneca.....

How on earth do they think these monickers up? The famous Roman poet and philosopher of that name has been dead these 2000 years or thereabouts https://en.wikipedia.org/wiki/Seneca_the_Younger

.....managed by Seneca.....
How on earth do they think these monickers up?

They want to show off their classical education - and infer that they are a business with a long pedigree

Vulgaris wrote:.....managed by Seneca.....

How on earth do they think these monickers up? The famous Roman poet and philosopher of that name has been dead these 2000 years or thereabouts https://en.wikipedia.org/wiki/Seneca_the_Younger

Come on, it's not unusual to take names from antiquity. My biggest VCT holding is managed by someone who used to call themselves Isis.

Though the biggest names from religions somehow seem to be excluded. I guess Isis was allowed because she no longer has a cult today.

scotia wrote:

.....managed by Seneca.....
How on earth do they think these monickers up?

They want to show off their classical education - and infer that they are a business with a long pedigree

Classical education? If it is, then you need to read the bits in bold italics to see what they think of us poor suckers.

definition one of Seneca from Websters dictionary {and most others} "a member of an American Indian people of what is now western New York. 2 : the Iroquoian language of the Seneca people. First Known Use: circa 1616."

From the urban dictionary

"seneca : There are two known Senecas

Seneca the elder : Born in Cordoba; Spain one of the greatest rhetoricians of Ancient Rome. His idol was the great Cicero.

Seneca the younger : He was an Ancient Roman philosopher, humorist, dramatist and statesman. Like Seneca the elder, Seneca the younger was born in Cordoba; Spain.

Seneca the elder:
"Against a slave everything is permitted.”

Seneca the younger:
"Religion is regarded by the common people as true,
by the wise as false,
and by rulers as useful."

and Urban dictionary again - and let's hope thus is what they were thinking of:

"seneca : A beautiful girl who is always there for you. she doesn't give up and is strong enough to stand up to anyone..no matter the case. she is caring and extremely nice. tends to be always happy about everything, dont mess with her or get on her bad side though....she has a bad temper for people she doesn't like. overall a loving girl who says she will do something and do it."

Hygea is defined here https://www.thefreedictionary.com/Hygea

GM on Fri 19 Jan to endorse proposed changes.

Resolutions passed to enable Seneca to raise funds for a new B class share. Resolution to sub divide ordinary shares adjourned to 29 Jan as HMRC approval taking longer than expected.

https://www.investegate.co.uk/hygea-vct ... 1838H2618/

Seneca made a presentation of itself at the GM attended by less than 10 shareholders.

127tolmers wrote:Resolutions passed to enable Seneca to raise funds for a new B class share. Resolution to sub divide ordinary shares adjourned to 29 Jan as HMRC approval taking longer than expected

This is taking its time to materialise, isn't it

Isthe HMRC rubber stamp on the subdivision of shares a prerequisite for the offer starting?

Just got email from wealth club. New B shares offer is now launched:

https://www.wealthclub.co.uk/venture-ca ... pital-vct/

I guess this is (inadvertently, it seems) the first one of 2018-19

Any thoughts on this?

Its a little early for me to be thinking of VCTs as I normally like to know at least a good estimate of my tax liability before investing

Does anyone even invest in VCTs anymore with all the changes?

Does anyone even invest in VCTs anymore with all the changes?

I'll probably still be continuing with VCTs - with a sizeable fraction being recycling of VCTs past their 5 year purchase date.
Hygea are not on my radar.

127tolmers wrote:There will be a new B class of share with a generalist mandate managed by Seneca. The existing ord class will continue to be self managed. Seneca will handle all the admin and as a dowry pay the ord share running costs for 3 years.

I have been looking at this as a possible buy, on the basis of the new manager (Seneca).
The prospectus makes it clear that the new B class will form a separate pool of capital - distinct from the existing ordinary share capital. That's OK - I would prefer a clean start. But the Prospectus also says "is expected to benefit the New “B” Shareholders by potentially allowing the
Company to pay dividends on the New “B” Shares far earlier than would have been the case if Seneca had launched a new VCT on its own."
That puzzles me. If the new B shares are in a separate capital pool from the existing ordinary shares, how can that happen? Help!

scotia wrote:how can that happen? Help!

Here's my guess.
When the new 'B' shares are issued they cannot receive dividends generated from their funds for a minimum of three years. However, the company as a whole has distributable reserves and because it is one company they can be used to pay both classes of shareholder. The losers are the original Hygea shareholders who are having their distributable reserves replaced in the balance sheet by money that cannot be distributed yet.

Kidman wrote:

scotia wrote:how can that happen? Help!

Here's my guess.
When the new 'B' shares are issued they cannot receive dividends generated from their funds for a minimum of three years. However, the company as a whole has distributable reserves and because it is one company they can be used to pay both classes of shareholder. The losers are the original Hygea shareholders who are having their distributable reserves replaced in the balance sheet by money that cannot be distributed yet.

Thanks for the guess! I can see how it may be possible to divert some of the "old" distributable reserves, and I can see that "old" investors would be aggrieved if there was nothing in return, so somehow some "new" money will need to find its way back into the "old" pot. Its difficult to understand how this equates to a "separate capital pool" - but remembering the machinations which surrounded the Octopus Titan VCT, nothing should surprise me!