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Upcoming Floats
date	name	activity	location	news
01/08/07	Aisi Realty Public	Property investment	Ukraine
01/08/07	Worldspreads Group	Spreadbetting	Ireland	1
02/08/07	Lewis Charles Romania Property Fund	Property investments	Romania
Late June/Early July	Ludgate Environmental Fund	Investment fund	Jersey
02/08/07	Rapid Realisations Fund	Investments	Guernsey
03/08/07	Et-china.com	Travel services	China
03/08/07	Nordic Land	Property investment	Sweden, Norway
03/08/07	Oakley Capital Investments	Private equity	Bermuda
03/08/07	Sepura	Mobile radio equipment	UK	1
06/08/07	Energybuild	Coal Mining	UK
06/08/07	IdaTech	Fuel cells	US	1
06/08/07	In House Group	Property management	UK
06/08/07	Nviro Cleantech	Environmental technology	UK	1
06/08/07	Wadharma Investments (Kiwara)	Mineral exploration	Zambia
Early August	American Leisure Group	Leisure development	US
10/08/07	Azurite Investments (Hitchens Retail)	Retail investments	UK
10/08/07	Hollywood Media Services	Event services	UK
Missed Stated Date
date	name	activity	location	news
Mid/End-July	Mathon Capital	Commerical property lender	UK
Mid-July	Asia Environmental Partners	Environmental investments	Asia
19/07/07	IMSG	Sales/marketing services	Ireland
Mid-July	Tsar Emerald Corporation	Emerald mining	Russia
18/07/07	Spitfire Oil	Oil producer	Australia
17/07/07	Park Plaza	Hotels	Europe	1
12/07/07	PME African Infrastructure Opportunities	Investments	Africa
06/07/07	Cardsave	Card payments	UK
Early July	Vietnam Infrastructure	Investments	Vietnam
03/07/07	Discover Leisure	Caravan/leisure retailer	UK
Late June	AOI Medical	Orthopaedic devices	US
29/06/07	Equidebt	Debt collector	UK	1
28/06/07	PXP Qudos Vietnam Property Fund	Property Investments	Vietnam
Mid-June	Genesis Worldwide Inc	Construction technology	Canada
07/06/07	Vector Hospitality	Hotels	UK	1 2 3 4 5 6 7 8 9
Recent Floats
date	name	activity	location	news
31/07/07	Connemara Mining Company (CON)	Zinc/Gold Mining	Ireland
Late July	Epicure Qatar Equity (EQEO)	Investments	Qatar
31/07/07	Pan African Resources (Barberton Mines) (PAF)	Mining	South Africa
26/07/07	Tawa (TAW)	Insurance investments	UK
24/07/07	Africa Opportunity Fund (AOF)	Investments	Africa
24/07/07	CapRegen (CGN)	Biotech investments	UK
24/07/07	India Hospitality Corp (IHC)	Hospitality investments	India
20/07/07	i-design group (IDG)	ATM adverts	UK	1
20/07/07	Mineral Securities (MXX)	Resource investments	British Virgin Islands
18/07/07	Mobile Doctors Group (Petsome) (MDG)	Medico-legal reports	UK
16/07/07	Freshwater UK (FWUK)	Marketing/PR	UK
16/07/07	Shieldtech (Base Group) (STEC)	Ballistic protection equipment	UK
13/07/07	Maple Energy (MPLE)	Oil/gas/ethanol	Peru
12/07/07	Dhir India Investments (DHIR)	Distressed investments	India
12/07/07	Superglass Holdings (SPGH)	Insulation manufacturer	UK
11/07/07	China Real Estate Opportunities (CREO)	Property investment/development	China	1
11/07/07	Trinity Venture Capital (TVC) (TVCH)	Investments	Ireland	1
10/07/07	Minerva Resources (Palladex) (MVA)	Mining	Kyrgyzstan, Ethiopia, Sierra Leone
09/07/07	Plant Offshore Group (POGL)	Oil/gas support	Malaysia
09/07/07	Queenco Leisure International (QLI)	Casino operator	Greece
06/07/07	Jetion Holdings (JHL)	Solar cell manufacturer	China	1
06/07/07	Mount Engineering (MOU)	Engineering	UK
05/07/07	Cobra Holdings (CBRA)	Wholesale insurance	UK
05/07/07	MobilityOne (MBO)	E-commerce payments	Malaysia

2007-08-01 13:20 (v1.0.3)

There is a bubble in initial public offerings (IPOs) that will cause awful losses for investors, the Sunday Telegraph's Questor column said. Royal Mail, with its monopoly on mail and parcel delivery and prime London property holdings, was the exception to an IPO boom that has seen companies such as Just Eat, AO World and Boohoo.com valued at 100 to 200 times profits. Investors should ask if owners are investing for growth or cashing in and whether the business has a dominant market position or protected technology. Ignore most IPOs and the shares will probably be cheaper six months later.

Backing the right horse in the IPO race and making sense of Quindell
By Gareth Burchell
April 26 2014, 9:00am
column image

Round the desk at Shard has been discussing IPOs over the last week. There have been 31 on AIM since January and with this frenzy investors need to be selective about which ones they go for – and as important, which they avoid.

Shard supported the Bagir Group’s (LON:BAGR) floatation on Tuesday April 15, dodged the Haydale Graphene Industries (LON:HAYD) and will be participating in the Rosslyn Data Technologies listing on the April 29. Below Gareth Burchell gives us his thoughts on our AIM debutants.

Bagir Group

Bagir has been around since the 60s and has been supplying tailoring to the likes Marks & Spencer since the early 70s. Bagir account for at least 40% of Marks’ and Arcadia’s formalwear business and also works with John Lewis, Austin Reed, Moss and House of Fraser.

The next step is to carve out this sort of market share in ladieswear market. The house broker thinks revenues of $100m could be more like $300m over time. Any loss of a major client would be a big blow and the sector is competitive. But with an anticipated yield in 2014 of 5.3%, it provides income and growth.

Haydale Graphene Industries

It seemed to us that the Graphene space could have been a bit of a bubble. We were fearful that the hype surrounding Graphene plays could have led to an inflated valuation and at £23mln we thought it was a bit too expensive. The broker forecasts did not excite us and lacked revenue visibility. Graphene undoubtedly has a lot of potential but we just felt the valuation of this particular company was a tad toppy. The price has been hit quite hard since its float at 210p, with shares currently around 141p.

Rosslyn Data technologies

Rosslyn is a “big data” play and a leader in cloud based analytics. The company takes all of its existing data from internal systems through to social media, tidy it all up and use the data to provide important analytics back to the client. It delivered £10mln of savings for one blue chip client for just a £60,000 spend and have an impressive list of over 50 multi-national customers including the likes of Coca Cola, Sony, Diageo, Xerox and GE.

Cenkos is bringing the stock to the market on the next week and we are looking forward to its debut. Although its revenues are early stage, the management have spent £5mln developing the technology and With any share in this space there is the chance that someone comes along with better technology, so Rosslyn will need to turn its potential into revenue. But, with a pre-money valuation of £15mln, we think there is upside from here.

And finally…Quindell

It has been a rollercoaster week for Quindell (LON:QPP) with the shares hitting a high of 40p and a low of 18.5p on the back of a report that all is not quite as it seems with the business. We at Shard like the shares and supported them in the 16p fundraise last year. At the time of writing we were expecting a detailed RNS either Friday or early next week to respond to this speculation and hopefully put the market straight. To me this moves seems overdone considering the company behind the report has made no secret of the fact it is short of the stock. What has probably made things worse is a series of stops being hit and people trading on leverage being closed out, making the decline much worse. If this Quindell’s response lays these allegations to bed, this could give believers a chance to top up at lower levels.

*The views expressed are the views of Shard Capital and should not be construed as investment advice, as we have not assessed your individual suitability for personal investment advice.

Anyone got thoughts on the SAGA IPO other than it's appropriate for moi?

Et Moi - now that I can do it through HL, I probably will.

As the blurb says - the over 50s is a growing market!

I need to read the prospectus but the one thing that worries me is that despite being one of their target audience I don't have a single product from them.

I actually insured my car through them this year - much to my son's amusement!

Father Jack..?

One SAGA benefit for old farts, who wish to take a holiday trip, is that there are no problems getting insurance. SAGA are very experienced in dealing with death and incontinence too, should you ever want to send off any elderly relatives for Christmas.

Their IPO? I think it might flop. IMHO, it's all about the 16% unpaid interest return due to the Preference Share holders. It has never been paid to them and has been allowed to stack up every year, thereby saving tax through turning any annual profit into a loss.

Andrew Goodsell, CEO, stands to get £210m from the float from this refinancing and the AA will be divested from the Group.

Coincidentally, my wife and I were cold called by their cruise sales dept. for the very first time ever only last week. For them to do that, we wondered if business is bad......? Hmmm? It might just be a change of sales policy. We are on their mailing list and they do have our phone number.

TravelEx are due to float by the end of June. Announcement due within the next couple of weeks.

Just in:

The SAGA float:

What does Saga do?

Let's start with some of the basic facts.

Saga is a business that offers a range of services to the over-50s. These include the Saga magazine, cruise trips, and a sizeable insurance operation. Insurance is the largest part of the business.

Saga is currently owned by a company called Acromas, which also owns the AA. Acromas is owned by several private equity firms as well as its senior management.

We don't yet know what the offer price will be, but it's expected to be in the range of 185p to 245p. That values the company at £2bn¬¬–£2.5bn. Although some debt will be paid off, Saga will still carry debts of £700m after the float.

If you want to buy shares, you need to apply by 11:59pm on Tuesday 20 May. You can do that online via the Saga website. Existing customers and employees get preference in the application process. (Here's the link if you're interested: https://www.sagashareoffer.co.uk/AboutShareOffer).

The main question to ask before you invest in any new listing

So should you buy in? Well, whenever a company lists on the stock market, I always want to know why it is happening.

Keeping things simple, there are three main reasons why a company might float:

• the owners of the company want to cash in their chips and sell

• the company wants to raise capital to invest and grow

• the company wants to raise cash to pay down debt


With Saga, it's pretty clear that this flotation is happening for two reasons: to pay down debt, and to enable the owners to sell some of their shares.

And that makes me nervous.

If a company is raising money for investment, then I might get excited about it. It could be a promising growth story with the potential to make me money.

But when it's a bunch of savvy private equity guys selling out, I worry that they're only going to sell for a full price. After all, Acromas has waited until we're five years into an equity bull market before selling. They want to get top dollar.

That's great for investors in the private equity funds. But I don't see why I should buy at or near the top.

Granted, Saga does have some strengths. It's profitable and has a strong brand which most people in the UK are aware of. It doesn't have to spend much on advertising as it has a great marketing database with 10.4 million names. And its customers appear to be satisfied – 88% of 'active customers' are repeat buyers.

What's more, its management thinks there's growth potential in wealth management and healthcare – which is probably true.

But I think these strengths are more than reflected in the proposed valuation. Saga made a pre-tax profit of £110m last year, which means that the company will probably trade on a price/earnings ratio in the high teens. That's a bit steep for what is, fundamentally, an insurance company with a couple of secondary businesses in publishing and travel.

What's more, there's no sign of profits growth – pre-tax profits have been pretty much static for the last three years.

The Saga flotation looks like a big cash-in – steer clear

It's also worth noting that the current executive chairman, Andrew Goodsell, is planning to become a non-exec boss within the next 18 months. He's already made more than £100m from the company, and stands to make a further £80m if the flotation is a success.

That's just another sign that this is just one big cash-in.

I also worry that some investors may buy in simply because they remember what happened with Royal Mail (LSE: RMG) last year. The shares floated at 330p last autumn and then soared to over £6 earlier this year. That was a great deal for investors – if not the taxpayer.

But not all stock market offerings perform that well. For example, earlier this year Pets at Home (LSE: PETS) floated at 245p. But the shares are now trading at 222.5p having fallen lower a few weeks ago.

I freely admit that there's a danger that I'm going to miss out on the growth potential lying in wealth management and healthcare. But at this price, I'm happy to take that risk. I'm not buying.

If you want to read a more detailed analysis of the Saga stock market listing, read Phil Oakley's analysis in this week's edition of MoneyWeek magazine.

After due consideration I have decided to pass on Saga. This should be an excellent signal for the rest of you to fill your boots!

Fi
1. Classification


Saga looks set be classed as a specialised consumer services company, putting it alongside companies such as EasyJet, Sainsbury and Greggs rather than an insurance company.


However, that is despite Saga generating 77pc of its profits from motor and home insurance.


The management says that reflects the fact that just 36pc of revenue is generated from insurance and that much of that comes from broking rather than underwriting.


The interesting point here is that consumer services shares as are often rated at about 20 times earnings, whereas UK-focused insurers trade on about at about 10 times earnings.


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12 May 2014
Saga: should you buy direct or via a broker?
14 May 2014
'It's time to sell AstraZeneca shares'
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2. Profits

During the past two years group profits before tax have been largely flat, rising only £1m in the last three years.

However, the shares look as though they will be priced at the top of the range, at around 245p.

That would give them a price earnings ratio of about 20 times, which is usually applied to a company where revenue and profits are growing very quickly.


3. Saga will have quite a lot of debt

A higher level of debt in a company increases risks to shareholders if anything goes wrong, as the owners of that debt have the first claim on any assets.

Saga will have debt’s of about £700m following the flotation against a balance sheet with net assets of £1.1bn.



4. Saga will still be majority owned by private equity

The largest single shareholder will still be Acromas, which is owned by private equity groups Charterhouse, Permira and CVC.

They are restricted from selling shares for 180 days. However, private equity is not known for publicly listed equities for the long term..

Management have assured that nothing will be done to damage the brand.

However, Saga will be an interested test case of the tensions between the interests of private equity owners who need to return cash to their investors and Saga customers who become shareholders themselves.


5. Expansion plans

Saga says it will boost growth and profits by offering legal services, share dealing, wealth management and private care in the home to its database of some 8.4m households.

However, can a leopard change its spots?

The group has not meaningfully shifted its profits from insurance during the past five years.

Each of those potential markets is also highly competitive.
ve reasons not to buy. (Daily Telegraph)

WIZZ AIR - "The Global Offer will comprise an offer of new Ordinary Shares by the Company to raise gross proceeds of approximately €200 million, and the sale of Ordinary Shares by existing investors, including investment funds managed by the Group's existing principal investor, Indigo Partners LLC ("Indigo"). It is also expected that, subject to Admission and other conditions being met, the Company will be considered eligible for inclusion in the FTSE UK Index Series. The Global Offer is expected to complete in June 2014."

Saga cuts float price despite 'exceptional demand'
Over-50s group Saga reduces maximum price at which it will sell its shares from 245p to 205p
by Richard Evans May 21, 2014

Source: http://www.telegraph.co.uk/finance/personalfinance/investing/shares/10846542/Saga-cuts-float-share-price-despite-exceptional-demand.html

Saga, the over-50s group, has cut the price range for its shares in the forthcoming flotation to between 185p and 205p.

Previously it had indicated a range of 185p-245p, so the change marks a 16pc reduction in the maximum price. The cut comes despite what the company called "exceptional demand" from private investors, many of whom are Saga customers.

Institutional investors have been less enthusiatic, however, indicating that they would not be interested in the shares if priced at the top of the original range. Sources close to Saga said the flotation had received demand for £1.5bn worth of shares from institutional investors across the new price range.

The company said the price cut was intended to increase the chances that investors who take part in the float would see gains when trading starts on Friday. "We remain very focused on seeking to underpin a positive aftermarket performance in the stock," the chairman, Andrew Goodsell, said.

Mr Goodsell said: “The retail offer has now closed, showing exceptional demand, and we continue to see strong momentum in the institutional offer.

"Given our desire to allow customers to play a significant part in the future ownership of the business, we remain very focused on seeking to underpin a positive aftermarket performance in the stock, with the appropriate balance between high quality institutional investors and retail investors.

"We are therefore narrowing the range to 185-205p per share to support a strong debut.”

The latest prediction of the price at which investors can sell their shares when trading starts is 223p, according to IG, which runs a "grey market" for its customers. If Saga sells the shares at the maximum 205p price, this would give investors an instant profit of about 9pc.

I decided against SAGA in the end - which should guarantee that they rocket!


FatFace abandons plans for IPO

TSB next one on my radar. A "clean" bank but unlikely to make much in the way of profits for some time.

Will keep reading the analysis what do others think?

I'm not now going to participate in the TSB IPO.

Interestingly, SAGA, which kicked off at 185p, is now down to 170p as I type.

Me neither - I didn't apply for SAGA but I did for PETS and BBOX recently.

My main reasons are:

Lots more shares to be issued - ie. the remaining 3/4 of the company - and this has to be before 2015 end.
TSB is likely to generate less than 10% returns. These are on the 'low side'.
Low returns have to mean mean low share prices.
TSB mortgages are a tadge risky - 45% being 'interest only' - even riskier when interest rates rise.
TSB is not involved in highly profitable investment banking.
The health of TSB is highly linked to the UK housing market - house prices are too expensive and customers are already overstretched.
No dividends - well, not until at least 2017.