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Octopus Titan / Cazoo
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- Lemon Slice
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Octopus Titan / Cazoo
It was in the Sunday press that Cazoo, apparently the swiftest UK start up to reach Unicorn status, is hoping to IPO at £5billion. Clearly "hoping" & achieving are very different matters but it is worth bearing in mind that Titan own, in last accounts, 3.3% of Cazoo, purchased at £5m & valued at £21.25mill, substantially less than its Unicorn status would suggest.
If this is IPO'd at anywhere close to the media suggestions there should be a juicy special divi coming for shareholders. I must declare that I bought some 3 years ago then a decent top up in December on their earlybird deal so I do have an interest, but this news, to my knowledge, only appeared at the weekend.
I believe my decimal point is in the right place but if I have missed something, my apologies !
If this is IPO'd at anywhere close to the media suggestions there should be a juicy special divi coming for shareholders. I must declare that I bought some 3 years ago then a decent top up in December on their earlybird deal so I do have an interest, but this news, to my knowledge, only appeared at the weekend.
I believe my decimal point is in the right place but if I have missed something, my apologies !
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- The full Lemon
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Re: Octopus Titan / Cazoo
Googling news on Cazoo finds a whole bundle of recent stories: Chesterman sells £100m of stock; Cazoo buys german biz to expand abroad.
It would be above my pay grade to speculate on whether news management is going on. Chesterman (Zoopla) contributed to that juicy special divi back in 2013, though that was before Titan grew so huge and diluted.
It would be above my pay grade to speculate on whether news management is going on. Chesterman (Zoopla) contributed to that juicy special divi back in 2013, though that was before Titan grew so huge and diluted.
Re: Octopus Titan / Cazoo
FT reported this morning that Cazoo set to float via US special purpose acquisition company AJAX I closing in Q3 2021 with a tag of US$8.1bln. Aim is to raise c.US$1bln cash proceeds from the deal. Credit Suisse/Goldman Sachs advising whilst JP Morgan advising AJAX.
Without fueling the debate around platform valuations (Deliveroo has eaten up too much time!), this could be a nice uplift for Titan
Without fueling the debate around platform valuations (Deliveroo has eaten up too much time!), this could be a nice uplift for Titan
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- 2 Lemon pips
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Re: Octopus Titan / Cazoo
Rather a juicy uplift in fact:
https://www.londonstockexchange.com/new ... e/14917849
NAV progress:
89.1p (11 Dec 2020) after last dividend
97.0p (19 Mar 2020)
104.0p (today)
So with 1,075,024,098 shares in issue, that now values the VCT at £1.12 billion. Whew
Wonder whether they are exiting any part of the holding in Cazoo?
Looks like being easily a 10x investment, in just over two years. Heck of a business that.
https://www.londonstockexchange.com/new ... e/14917849
NAV progress:
89.1p (11 Dec 2020) after last dividend
97.0p (19 Mar 2020)
104.0p (today)
So with 1,075,024,098 shares in issue, that now values the VCT at £1.12 billion. Whew
Wonder whether they are exiting any part of the holding in Cazoo?
Looks like being easily a 10x investment, in just over two years. Heck of a business that.
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- Lemon Slice
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Re: Octopus Titan / Cazoo
https://www.telegraph.co.uk/technology/ ... es-public/
https://www.ft.com/content/b9d21ee4-c94 ... 2bf11fcc4f
FT suggests the Cazoo IPO is at 3x last October's fund-raising. At $8bn or say $5.7bn. The Titan stake could be worth over £180m or an uplift of £120m since October. There was a recent NAV uplift to 97p at 31 Dec and now a further uplift to 104p.
https://www.lse.co.uk/rns/OTV2/net-asse ... w5v61.html
https://www.ft.com/content/b9d21ee4-c94 ... 2bf11fcc4f
FT suggests the Cazoo IPO is at 3x last October's fund-raising. At $8bn or say $5.7bn. The Titan stake could be worth over £180m or an uplift of £120m since October. There was a recent NAV uplift to 97p at 31 Dec and now a further uplift to 104p.
https://www.lse.co.uk/rns/OTV2/net-asse ... w5v61.html
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- Lemon Slice
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Re: Octopus Titan / Cazoo
Sinterklaas/Tolmers
My read of the rns is that it reflects the fact that Cazoo intends, by spac, to list on the NYSE, so that implies to me that they have raised the valuation on this news but as and when Cazoo is listed the nav could increase again when they have a proper price on which to value, or exit, their investment.
So with luck we might have rather more meat on the bone ?
Considering the December allotment to existing shareholders was at 90.24p, with nav at 89.1p this is a pretty dramatic movement for a vct of this size already.
My read of the rns is that it reflects the fact that Cazoo intends, by spac, to list on the NYSE, so that implies to me that they have raised the valuation on this news but as and when Cazoo is listed the nav could increase again when they have a proper price on which to value, or exit, their investment.
So with luck we might have rather more meat on the bone ?
Considering the December allotment to existing shareholders was at 90.24p, with nav at 89.1p this is a pretty dramatic movement for a vct of this size already.
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Re: Octopus Titan / Cazoo
Yes I make it a 16.7% uplift to NAV since December’s dividend.
That isn't just Cazoo of course, but it does seem to have had a substantial effect.
You’re right there could be further impact. It depends on whether Titan is selling, of course we're not to know that yet. But their previous track record, they have tended to sell the big ones down in stages (Zoopla, Graze) over a number of years. They also didn't sell Eve at IPO (which… hasn't gone so well).
So I would assume they continue to hold, maybe slice off a little at a time.
That isn't just Cazoo of course, but it does seem to have had a substantial effect.
You’re right there could be further impact. It depends on whether Titan is selling, of course we're not to know that yet. But their previous track record, they have tended to sell the big ones down in stages (Zoopla, Graze) over a number of years. They also didn't sell Eve at IPO (which… hasn't gone so well).
So I would assume they continue to hold, maybe slice off a little at a time.
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Re: Octopus Titan / Cazoo
The half year report is interesting, Cazoo stake valued at £122 million (cost: £5 million)
Look at Depop too. Cost £8.77m valued at 30 June £97.4m - they sold shortly after that.
These two aren't even the biggest valued holdings – that would be insurer Bought By Many (£127m value, cost ≈£10m)
Nice special dividend of 6p per share (meaning £67.2 million being paid out) plus the regular interims.
Octopus itself didnt do too badly of course with a £55.6m performance fee
This VCT has always set out to do big winners, ambitious companies, good to see this playing out.
Look at Depop too. Cost £8.77m valued at 30 June £97.4m - they sold shortly after that.
These two aren't even the biggest valued holdings – that would be insurer Bought By Many (£127m value, cost ≈£10m)
Nice special dividend of 6p per share (meaning £67.2 million being paid out) plus the regular interims.
Octopus itself didnt do too badly of course with a £55.6m performance fee
This VCT has always set out to do big winners, ambitious companies, good to see this playing out.
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- Lemon Slice
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Re: Octopus Titan / Cazoo
Sinterklaas
Indeed I echo your thoughts, I put mine on the "going going" thread as it was also relevant there, but a 20.5% ulift in NAV from end Dec to end June is nothing less than impressive, even though they do tend to price to perfection. One caurionary note, however, they price to last paid which given that Spacs are involved in some of these substantial uplifts could mean that perhaps the valuations are optimisistic given that these financial vehicles are currently the flavour of the month & need to spend money ?
Indeed I echo your thoughts, I put mine on the "going going" thread as it was also relevant there, but a 20.5% ulift in NAV from end Dec to end June is nothing less than impressive, even though they do tend to price to perfection. One caurionary note, however, they price to last paid which given that Spacs are involved in some of these substantial uplifts could mean that perhaps the valuations are optimisistic given that these financial vehicles are currently the flavour of the month & need to spend money ?
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Re: Octopus Titan / Cazoo
sinterklaas wrote:This VCT has always set out to do big winners, ambitious companies, good to see this playing out.
Anyone see a parallel between Titan's success and Scottish Mortgage IT's success? The big bets on big growth stories?
Can't help noticing the stark difference in charges.
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- Lemon Slice
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Re: Octopus Titan / Cazoo
Uncle
I take your point re the huge gap in costs between Octopus & BG, however it is fair to say that Titan tends to be involved in setting up companies whereas BG tend to buy into an already set up entity, eg Tesla.
What does bother me though, which your response prodded me to think about, is the fact that most vct's exit cleanly whilst Titan now has some seemingly strataspheric valuations based on what the last (spac, typically) buyer paid, so if, say, Cazoo turns into a "Last Minute .com" like the grand old Duke of York the valuations will be marching all the way down again.
I would like to see Titan take a few more cards off the table before special divis are paid in all honesty.
I take your point re the huge gap in costs between Octopus & BG, however it is fair to say that Titan tends to be involved in setting up companies whereas BG tend to buy into an already set up entity, eg Tesla.
What does bother me though, which your response prodded me to think about, is the fact that most vct's exit cleanly whilst Titan now has some seemingly strataspheric valuations based on what the last (spac, typically) buyer paid, so if, say, Cazoo turns into a "Last Minute .com" like the grand old Duke of York the valuations will be marching all the way down again.
I would like to see Titan take a few more cards off the table before special divis are paid in all honesty.
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Re: Octopus Titan / Cazoo
barchid wrote:Uncle
I take your point re the huge gap in costs between Octopus & BG, however it is fair to say that Titan tends to be involved in setting up companies whereas BG tend to buy into an already set up entity, eg Tesla.
Indeed. But the contrast is more than that: SMT and Titan are our biggest IT and VCT respectively, but comparing like with more-or-less like, SMT's charges are amongst the lowest in ITs while Titan's are amongst the highest in VCTs.
My other point was to wonder about correlation. If a change in the market zaps the kind of disruption and innovation that has fuelled their respective successes, might both take quite a knock?
I sold my Titan in 2019 when raising funds for the house purchase.
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Re: Octopus Titan / Cazoo
Sold my 2yr old covid low mileage car for almost the same price I paid to Audi. Great service from Cazoo as no haggling, paid the price given online which was 5k more than WBAC.com. Money was in the bank before she left the driveway. The lady who collected told me Cazoo were offering over market value for another three months. She also said that the staff were given shares at the float and told to expect $25 each. On only realising $8 they made up the difference in shares to the $25 value.
Hope that's not too off topic!
SB
Hope that's not too off topic!
SB
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