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Re: A & GA Prefs
Posted: March 29th, 2018, 10:10 am
by 88V8
The FCA are past masters when it comes to inaction.
The simple answer to Dodd's question is of course that Aviva thought it could deviously retire the debt on the cheap.
Prices have not quite returned to their pre-kerfuffle level. So there is residual concern that other issuers could seek to crawl through similar slimey holes.
I took the opportunity to top up with Aviva and GA prefs while all this was going on, and atm I am not unhappy. But if I added up my overall exposure to Financials, I should be unhappy. So I'll refrain from adding it up
V8
Re: A & GA Prefs
Posted: March 29th, 2018, 11:21 am
by OwenSwansea
Andrew Bailey should consider his position, he is clearly unfit to be head of the Financial Conduct Authority.
Re: A & GA Prefs
Posted: March 29th, 2018, 1:20 pm
by OwenSwansea
It has crossed my mind, is GoSeigen and Andrew Bailey the same person?
Re: A & GA Prefs
Posted: March 29th, 2018, 3:54 pm
by Itsallaguess
OwenSwansea wrote:
It has crossed my mind, is GoSeigen and Andrew Bailey the same person?
Moderator Message:
I think there's been quite enough posts like this, being really quite personal, so can you please stop it?
Itsallaguess
Re: A & GA Prefs
Posted: April 1st, 2018, 11:25 pm
by Wizard
Sadly it appears GoSeigen has been driven away. A real loss to LemonFool IMHO, as his perspective was well informed and interesting.
Re: A & GA Prefs
Posted: April 2nd, 2018, 8:51 am
by OwenSwansea
Wizard wrote:Sadly it appears GoSeigen has been driven away. A real loss to LemonFool IMHO, as his perspective was well informed and interesting.
Moderator Message:
Offensive comment removed.
TJH
Re: A & GA Prefs
Posted: April 2nd, 2018, 9:04 am
by PeterGray
Owen,
Please can you stop these pointless, unjustified and ridiculous personal attacks on someone who says things you don't like to hear. You just reduce the value of forum like this for those who want to discuss issues - which is what they are here for.
What is the point of a discussion forum, and how does it help make useful investment decisions if people who say things that are uncomfortable, or which you don't like to hear, are abused and discouraged from posting? Making good decisions requires considering all sides of an argument and making your own decision on the best way forward. If you exclude anyone who doesn't say what you want to hear your investment decisions are unlikely to be good ones.
Peter
Re: A & GA Prefs
Posted: April 2nd, 2018, 4:57 pm
by OwenSwansea
PeterGray wrote:Owen,
Please can you stop these pointless, unjustified and ridiculous personal attacks on someone who says things you don't like to hear. You just reduce the value of forum like this for those who want to discuss issues - which is what they are here for.
What is the point of a discussion forum, and how does it help make useful investment decisions if people who say things that are uncomfortable, or which you don't like to hear, are abused and discouraged from posting? Making good decisions requires considering all sides of an argument and making your own decision on the best way forward. If you exclude anyone who doesn't say what you want to hear your investment decisions are unlikely to be good ones.
Peter
Peter,
There is merit in what you write, and I must try and contain myself from now on.
Moderator Message:
Reference to other posters removed. Please see PM sent to you earlier. Final warning now. Clariman
Owen
Re: A & GA Prefs
Posted: April 2nd, 2018, 6:47 pm
by johnhemming
Can I endorse what the moderators say. It really doesn't help when people are abusive towards those that they disagree with.
Re: A & GA Prefs
Posted: April 2nd, 2018, 9:52 pm
by Kr1ck
For those of us with longer memories, GoSeign was one of the most knowledgeable and welcome posters at the old Motley Fool Banking board. I cannot understand those who seek to shoot the messenger. Has the duplicity of the FCA, the sagas of the Bank of Ireland, Coop Bank and Lloyds ECN's taught us nothing? Moral outrage is all well and good but that cuts no ice in a court of law. Do our opponents have an arguable legal case? Now that, I want to know and I thank GoSeign for his valuable contributions, not only on Aviva but numerous other issues over the years.
Re: A & GA Prefs
Posted: April 2nd, 2018, 10:14 pm
by Alaric
Kr1ck wrote: Do our opponents have an arguable legal case?
To my mind the key points where whether it was intended at the time of the original agreement that Aviva and others were given an option to repay their borrowings at par if interest rates were to fall. To my mind that was certainly "no" and someone who claimed or appeared to understood the fixed income market should have appreciated this. The other key point was whether the requirement of the Companies Acts to hold a vote of shareholders to initiate a capital return required separate votes to be held if there were multiple classes of shareholder. Some clever dick lawyers seemed to argue that it didn't despite this riding a coach and horses through what had been presumed market and legal practice.
Re: A & GA Prefs
Posted: April 3rd, 2018, 8:06 am
by Wizard
Alaric wrote:Kr1ck wrote: Do our opponents have an arguable legal case?
To my mind the key points where whether it was intended at the time of the original agreement that Aviva and others were given an option to repay their borrowings at par if interest rates were to fall. To my mind that was certainly "no" and someone who claimed or appeared to understood the fixed income market should have appreciated this. The other key point was whether the requirement of the Companies Acts to hold a vote of shareholders to initiate a capital return required separate votes to be held if there were multiple classes of shareholder. Some clever dick lawyers seemed to argue that it didn't despite this riding a coach and horses through what had been presumed market and legal practice.
But for the Aviva shares that raises the question of why were preference shareholders given the 4 votes per share, at the time enough to outvote ordinary shareholders? If not to protect from having capital return forced on them then for what purpose? If it was to protect preference shareholders from unwanted capital return then the issuance of more ordinary shares without any adjustment to voting would seem to have changed the terms of the preference shares.
But AFAIK this question is unique to Aviva.
Terry.
Re: A & GA Prefs
Posted: April 3rd, 2018, 8:15 am
by johnhemming
Wizard wrote:But AFAIK this question is unique to Aviva.
That issue also raises a question as to whether the Aviva prefs were given a class vote on the issuing of more ordinary shares as that changed the ability of the prefs to block decisions by the ordinary shares. It is now academic, but a worthwhile issue.
Re: A & GA Prefs
Posted: April 3rd, 2018, 8:17 am
by Alaric
Wizard wrote:But for the Aviva shares that raises the question of why were preference shareholders given the 4 votes per share, at the time enough to outvote ordinary shareholders?
If it had come to Court perhaps witnesses to the original design of the fund raising would have testified as to the original intent of the parties. Were the Pref holders relying solely on those voting rights as a protection against a forced return of capital? It's known that there were intended to be clauses to prevent unilateral return of capital as otherwise the Ordinary Shareholders could pocket the funds just supplied and leave the Pref holders with a Company unable to pay Pref dividends.
The other interpretation is that it was purely technical as the Prefs were nominal 25p and the Ordinaries nominal £ 1 and that if the Prefs were ever called on to vote, it would be as a separate class. If otherwise, then as indicated, the Prefs should have been required to approve each and every increase in capital or been given additional votes to protect their rights if the Companies Acts failed to do so.
Re: A & GA Prefs
Posted: April 3rd, 2018, 9:17 am
by PeterGray
Alaric wrote:Kr1ck wrote: Do our opponents have an arguable legal case?
To my mind the key points where whether it was intended at the time of the original agreement that Aviva and others were given an option to repay their borrowings at par if interest rates were to fall. To my mind that was certainly "no" and someone who claimed or appeared to understood the fixed income market should have appreciated this. The other key point was whether the requirement of the Companies Acts to hold a vote of shareholders to initiate a capital return required separate votes to be held if there were multiple classes of shareholder. Some clever dick lawyers seemed to argue that it didn't despite this riding a coach and horses through what had been presumed market and legal practice.
While I agree with that, I think we also have to be aware that it's clear that an opinion that allowed cancellation at par was given, and the Aviva board were prepared to back it. They must have had legal opinion that they felt justified their proposed actions or they would never have made the statements they did. They may have been legal arguments that would have had a low chance of success, and they may even have been aware of that, but I don't think think there's any doubt that they felt they could argue a case in court to support what they proposed. And once you get there the outcome is always going to be uncertain and expensive.
Peter
Re: A & GA Prefs
Posted: April 3rd, 2018, 10:23 am
by Holts
johnhemming wrote:Can I endorse what the moderators say. It really doesn't help when people are abusive towards those that they disagree with.
Seconded , I am surprised to see such here , I do not recall it at all on the old fool board , it is not necessary , its helpful too see the arguments from both viewpoints .
Re: A & GA Prefs
Posted: April 3rd, 2018, 5:07 pm
by Wizard
Alaric wrote:If it had come to Court perhaps witnesses to the original design of the fund raising would have testified as to the original intent of the parties. Were the Pref holders relying solely on those voting rights as a protection against a forced return of capital? It's known that there were intended to be clauses to prevent unilateral return of capital as otherwise the Ordinary Shareholders could pocket the funds just supplied and leave the Pref holders with a Company unable to pay Pref dividends.
The other interpretation is that it was purely technical as the Prefs were nominal 25p and the Ordinaries nominal £ 1 and that if the Prefs were ever called on to vote, it would be as a separate class. If otherwise, then as indicated, the Prefs should have been required to approve each and every increase in capital or been given additional votes to protect their rights if the Companies Acts failed to do so.
I appreciate that this is, at least at the moment, somewhat academic when it comes to the Aviva preference shares. The reason I am interested is because of the possible read through to other preference shares, if Aviva felt it necessary to put in place the 4 votes mechanism to protect holders because at the time it was understood that there was no protection under company law then what does that say for other preference shares where there was never a similar mechanism in place?
Trouble is I suspect nobody likely to contribute to this discussion will know the answer.
Terry.
Re: A & GA Prefs
Posted: April 11th, 2018, 7:00 pm
by johnhemming
https://www.thetimes.co.uk/article/clos ... -t2zf96xvqreasonable use from The Times wrote:A group of City institutions that fought Aviva over its plans to redeem £450 million of preference shares without paying a premium has asked the government to close a legal loophole to prevent other companies doing the same.
M&G Prudential, Invesco, GAM, Blackrock, Edentree and Legal & General wrote to John Glen, economic secretary to the Treasury, yesterday calling for the Companies Act to be changed to end uncertainty over the millions of pounds of outstanding preference shares in circulation.
This may be what was behind a (small) jump in pref prices today.