Dictum de dicto
01 Feb 2018
Don't panic Capita is "not comparable" to Carillion, the government said, following a profit warning that wiped more than £1bn off its market value.Cabinet Office Minister Oliver Dowden told the House of Commons his officials met senior executives of Capita to discuss the impact of its announcement.He said Capita was not "in a comparable position" to Carillion, which went bust last month.[link] be OK then if HMG says so........given its outstanding track record on this sort of thing.Labour of course think differently; they would wouldn'yt they (no political axe to grind of course)'More similarities than differences'However, Ms Reeves described the government's thinking on the differences between Capita and Carillion as "muddled and complacent".The Labour MP said: "Both Capita and Carillion have debts of more than £1bn and pensions deficits in the hundreds of millions. Both Capita and Carillion paid out dividends of more than £1bn in the last five years."Both Capita and Carillion rely on the public purse for half of their contracts. Both Capita and Carillion were audited by KPMG. Both Capita and Carillion grew through acquisition and not through organic growth."It seems there are more similarities than differences between these two companies," she added.I don't expect the truth from either side.
Dictum de dicto
01 Feb 2018
Marcap, Rights; Seaching for a bottom As I watch the marcap is struggling to stay above £1bn (670m x 160p ). Let's be generous and say £1.1bn. It needs £700m....Twice today it looked like it might have bottomed but gravity seems to keep pulling it back. It looks lke the velocity of the fall has reduced but it's still a volatile and somewhat febrile environment. I reckon on at least another day before we see signs of a believable bottom. Any predictions out there on where the bottom might actually be?
Dictum de dicto
01 Feb 2018
Re: Dont rub in in These are the guys expected to stump up:[link] they?If some do and the 'stand by' arrangement is required, how long will it be before those shares are dumped on the market, at what price and over what timeline. I've been there before, more than once..Somewhat frustratingly I probably still have an interest in Capita via a small investment in one of the eponymous Mr Woodford's funds. Given that it's income oriented I'm none too convinced that he will deploy what should be income producing investment money on a non-dividend income delivering company. We'll see.
cooperboy
01 Feb 2018
Re: Dont rub in in Youre right-could add card factory, saga, convatec etc-even if the bad news is relatively minor the PIstill get shafted by the hedge funds and shorters. I took the decision last year to only have medium term investments in funds and investment trusts mainly with US and far east exposure. I kept about 6k back to have punts on individual companies but now only view this as gambling money
maproom
01 Feb 2018
Re: how much is the rights price > Why have they not arranged the rights now before the MM bring price down ?Because, if they choose the rights price and then the market price falls to below the price they've chosen, no-one will take up the rights.
kolwezimundele
01 Feb 2018
Re: Dont rub in in Why is anyone invested in the mid- to large-cap sector in the UK ATM? Carillion, Capita, Provident Financial, National Grid, Glaxo, IMB, AA etc etc. And those are not doing themselves in are being done in by such bloodhounds as the SFO (Petrofac - can't pay facilitation fees in the Middle East for business, despite the fact that every other company does, but it's 100% fine for management to bring an entire company to its knees (Carillion)). Everyone finds the odd share that hits the stars but, apart from a few select companies (ie. mainly those led by overseas earnings) that continue to stabilise the index, things really do look rather poor ATM for investors, and don't appear to be getting better anytime soon. Granted most investment funds are nearing a 52 week high, but again that is mostly because of their overseas investments and overseas growth.Cash to invest due to a lump sum receipt - seemingly nowhere (in the UK) to invest it....
Bill1703
01 Feb 2018
Re: Dont rub in in "The reality is that (see my previous posts) Capita is effectively bankrupt to the tune of around £1 billion. Why would any investor want to invest in a rights issue; it is rather like backing a horse in a race after it has fallen?" What utter rot, NB! Alarmist and deliberately antagonistic polemic (not to mention innumerate)... Unilever is just about the most solid business among quoted stocks, the bluest of "blue" chips, dependable and defensive. Yet on your numbers (sic), it is now "effectively bankrupt" to the tune of several billion euros... and best part of E15bn if you arbitrarily discount all intangible assets.Who knows whither the fate of Capita, from here - it is perfectly possible that its several issues get worse before they get better, if they ever do. But one certainty is that at times like this, there is no shortage of wise-after-the-event smart alecs (again, sic) jumping up to spew out their barely-understood "analysis" to tell us all where we've already come from - much as accountants do, only with neither the qualifications nor the experience...."Standby Underwriting: A type of agreement to sell shares ... in which the underwriting investment bank agrees to purchase whatever shares remain after it has sold all of the shares it can to the public. In an underwriting standby (standby) agreement, the underwriter agrees to purchase any remaining shares at the subscription price, which is lower than the stock's market price. This underwriting method guarantees the issuing company... will raise a certain amount of money."I don't doubt, Citi and Goldmans will be earning a fat fee for signing up to this - but they will also have (had to) form their own view as to the prospects of said horse...Let's have more proper analysis and balanced commentary - and less baloney!!
Mr Papillon
01 Feb 2018
Re: Dont rub in in ‘Rather like backing a horse after it’s fallen.’ I like this phrase. But in the context of Capita, your bet is not that it will win, but that it will finish. To me it won’t be put down and shot like Carillion but it will take time to recover. But recover it will.Time will tell.
Johandesilva
01 Feb 2018
Re: Guardian view; 'CurtaIns for Capita?' "Perhaps nor quite as bad as Carillion but desperately close. "---No, FCS on the total revenue is not in the same ball park. Time will tell but my hunch is that Capita is a different animal and more transparent.I am not saying this is a buy today but it is a buy.
Ripley94
01 Feb 2018
Re: Dont rub in in I mentioned lomin before who did a rights when things looked like this ?Difference numberbiter ?
numberbiter
01 Feb 2018
Re: Dont rub in in If you read the statement put out by Capita in detail, you will be able to work out that things are really bad, with more losses (impacting overall profits) coming through. The only essential difference between Capita and Carillion is that Capita's directors cannot be accused of presenting a false picture.With the dividend cancelled (like Carillion) it must be obvious that the banks will not lend the company anymore money. We all thought Carillion would survive because of some sort of equity issue but it never happened.Capita needs to raise more than £700 million, as the statement indicated that the company was underinvested in key areas of the business where more working capital will be needed. So raising equity of £700 million will not reduce net debt by much.The agreement with insurers to underwrite an issue up to £700 million is only a standby agreement, whatever that means. The reality is that (see my previous posts) Capita is effectively bankrupt to the tune of around £1 billion. Why would any investor want to invest in a rights issue; it is rather like backing a horse in a race after it has fallen?
Ripley94
01 Feb 2018
Re: how much is the rights price Why have they not arranged the rights now before the MM bring price down ?
shugg1e
31 Jan 2018
Re: Added at 360p for a 360 Ouch!!Unlucky mate
sandeeppp
31 Jan 2018
how much is the rights price wanted to know how much the rights price will be and if private investors allowed to take up?
Ripley94
31 Jan 2018
Re: next Carillion Doomsayer you were ahead of the game with your post Sunday.Down 50% Wednesday.Unfortunately i was in Carillion at least you have not got the loss making construction contracts.Hopefully they have looked at Carliiion and will learn from it.But then again the banks went one after another.
