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Transcentury IPO
Rank: Elder Joined: 5/27/2008 Posts: 3,760
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mwekez@ji wrote:Gordon Gekko wrote:@mwekez @ji, conversion is never at the option of the holder but the company's discretion @Gordon Gekko, read page 152 of the IM (conversion right) and page 90 of the bond prospectus and you will realize that conversion is an option and a right of the bondholder. Actually, they can even convert on the first day of listing i.e. 14th July 2011 True true, I've just read it, and my apologies. This one is seriously skewed towards the bond holders. It is senior debt, if the introduction pans out well the holders convert and cash out, if it doesn't they still get their 6%
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Rank: Member Joined: 8/8/2009 Posts: 170
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Thanks Sober, but from my understanding... 1. TC Mauritius is the Issuer. 2. The bond issue has to be arranged and then sold (commonly via syndicate), to prospective investors. 3. From prospectus, the issue has been arranged by Krimlane Ltd.... Who are they / Anyone heard of them? The website domain was registered in Kenya... Oct 2010. http://whois.domaintools.com/krimlane.com
4. The bond issue is not underwritten; who are the selling agents/book runners? i.e. It's a Eurobond...who is placing it? 5. Subscription rate or when does the bond open? mwekez@ji wrote:If the share trades above KES.40 the bond holders will quickly convert them to shares and make a killing by selling them to you. From prospectus FX Conversion RateThe Convertible Bonds will be translated into Kenyan Shillings at the fixed rate of KSh 80.49135 to USD 1.00. Real time USD/KEShttp://www.forexpros.com/currencies/usd-kes
(89.70*-80.49)+40 = 49.21 vs 50 (listing price).... I think what's key would be to determine the "No-Arbitrage" price and then find out what's going on with the bonds.... the rest is easy :D *@ 13:01 EAT
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Rank: Chief Joined: 5/31/2011 Posts: 5,121
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drake wrote:
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Subscription rate or when does the bond open?
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what's going on with the bonds
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The issue date was 25 March 2011 Subscription rate??? .
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Rank: Member Joined: 8/8/2009 Posts: 170
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mwekez@ji wrote:
The issue date was 25 March 2011
Subscription rate???
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True, but apparently the Eurobond is "phased" (press) so when does phase II/ tranche II start? The Equity will need "juice" to attract bondholders no? Subscription rate ... when applications exceed the amount initially sought . e.g. they've raised 35MM (as of 05/07/2011) was that the target for "this phase" or fell short?
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Rank: Chief Joined: 5/31/2011 Posts: 5,121
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drake wrote:True, but apparently the Eurobond is "phased" (press) so when does phase II/ tranche II start? The Equity will need "juice" to attract bondholders no?
Subscription rate ... when applications exceed the amount initially sought . e.g. they've raised 35MM (as of 05/07/2011) was that the target for "this phase" or fell short? The bond prospectus did not mention that the Eurodollar bond was to be issued in tranches. I think TransCentury are unable to raise all the USD.75M through the bond and have been forced to change their plan. The USD.35M will only be sufficient to pay their required additional investment in RVR of USD.27M (80M*34%). It looks like the additional projects, including the 100MW geothermal project in Menengai that would require USD.100M, will have to wait. BTW, their gearing ratio is really high and the bonds are worsening the situation. Probably the Njungus wameogopa.
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Rank: Chief Joined: 5/31/2011 Posts: 5,121
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drake wrote:True, but apparently the Eurobond is "phased" (press) so when does phase II/ tranche II start? The Equity will need "juice" to attract bondholders no?
Subscription rate ... when applications exceed the amount initially sought . e.g. they've raised 35MM (as of 05/07/2011) was that the target for "this phase" or fell short? The bond prospectus did not mention that the Eurodollar bond was to be issued in tranches. I think TransCentury are unable to raise all the USD.75M, at a go, through the bond and have been forced to change their plan. The USD.35M will only be sufficient to pay their required additional investment in RVR of USD.27M (80M*34%). It looks like the additional projects, including the 100MW geothermal project in Menengai that would require USD.100M, will have to wait. BTW, their gearing ratio is really high and the bonds are worsening the situation. Probably the Njungus wameogopa .
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Rank: Elder Joined: 6/2/2008 Posts: 1,438
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For sure this is a lemon. But...money has been made from worse places. The jewel in their crown i.e. E.A. Cables is being given a severe battering!
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Rank: Veteran Joined: 10/11/2009 Posts: 1,223
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mwanahisa wrote:For sure this is a lemon. But...money has been made from worse places. The jewel in their crown i.e. E.A. Cables is being given a severe battering! The battering (EA Cables) is of the magnitude that they cannot even pay dividends 42-days after their due date. Hii listing ya TCL iko na Ukora ndani yake. History will not remember you for your IQ. It will remember you for what you did. “Genius is 1 percent inspiration, 99 percent perspiration.” Thomas Edison
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Rank: Elder Joined: 6/2/2008 Posts: 1,438
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BTW, what plans do TCL have for E.A. Cables? Logic dictated that they would try to shore up E.A.Cables share price to smoothen the way for their listing but maybe these guys are cleaner than I thought...
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Rank: Elder Joined: 10/13/2009 Posts: 1,950 Location: in kenya
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mwanahisa wrote:BTW, what plans do TCL have for E.A. Cables? Logic dictated that they would try to shore up E.A.Cables share price to smoothen the way for their listing but maybe these guys are cleaner than I thought... I think the purpose for the introduction is not necessarily to attract investors into buying their shares.I think the listing is a way of creating a market for their convertible Bonds. The only way they can shore up EACables is by buying the shares which will eat their little capital. TCL needs a huge capital outlay which even the sell of its shares cannot satisfy their thirst so they are forced to use ingenious ways to generate capital. '......to the acknowledgment of the mystery of God, and of the Father, and of Christ; 3 In whom are hid all the treasures of wisdom and knowledge.' Colossians 2:2-3
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Rank: Chief Joined: 5/31/2011 Posts: 5,121
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selah wrote:I think the purpose for the introduction is not necessarily to attract investors into buying their shares.I think the listing is a way of creating a market for their convertible Bonds.
The only way they can shore up EACables is by buying the shares which will eat their little capital.
TCL needs a huge capital outlay which even the sell of its shares cannot satisfy their thirst so they are forced to use ingenious ways to generate capital.
@selah, the purpose of the introduction is to attract investors into buying their shares so that they can be able to raise capital through the ingenious ways. Quote:“The listing is part of a long-term strategy to ensure that the Company diversifies and grows the investor base, in line with the strategic focus on Power Infrastructure, Transport Infrastructure and Specialised Engineering”, commented Dr Gachao Kiuna, the group Chief Executive Officer. “These sectors are capital intensive and a key driver of success will be the ability to develop attractive sources of funding and technical partnerships.”
TransCentury is like an industrial company with very huge capital requirement in order to realize its potential. The ingenious ways of raising capital that have been developed (and those to be developed) will only work if the share attracts very high demand and trades at very high prices which may not happen. KES.50 is gross overvaluation of TCL. And consider one is staring at 36% dilution from the conversion of the Eurodollar bonds. My 2 Euro Cents
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Rank: Veteran Joined: 4/16/2010 Posts: 906 Location: Nairobi
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What about the potential for the railway? Isn't that something to watch out for?
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Rank: Elder Joined: 7/21/2010 Posts: 6,192 Location: nairobi
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This reminds me of mumias rights at 49.50 and today 7bob...buy at your own will. "Don't let the fear of losing be greater than the excitement of winning."
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Rank: Elder Joined: 9/29/2006 Posts: 2,570
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mlennyma wrote:This reminds me of mumias rights at 49.50 and today 7bob...buy at your own will. @mlennyma. Divide 49.50 by 3 b4 comparing with 7 bob. I sold at ~3.50! The opposite of courage is not cowardice, it's conformity.
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Rank: Veteran Joined: 3/25/2011 Posts: 946
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jerry wrote:mlennyma wrote:This reminds me of mumias rights at 49.50 and today 7bob...buy at your own will. @mlennyma. Divide 49.50 by 3 b4 comparing with 7 bob. I sold at ~3.50! ???????????????????? bought rights at 49.00 and sold at 3 bob . are you an investor ????? that kind of aloss sis enough to give me nightmares....
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Rank: Elder Joined: 9/29/2006 Posts: 2,570
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QW25071985 wrote:jerry wrote:mlennyma wrote:This reminds me of mumias rights at 49.50 and today 7bob...buy at your own will. @mlennyma. Divide 49.50 by 3 b4 comparing with 7 bob. I sold at ~3.50! ???????????????????? bought rights at 49.00 and sold at 3 bob . are you an investor ????? that kind of aloss sis enough to give me nightmares.... @QW, I made a loss of 23k on MSC. I didn't participate in the rts. The opposite of courage is not cowardice, it's conformity.
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Rank: Chief Joined: 5/31/2011 Posts: 5,121
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KenyanLyrics wrote:What about the potential for the railway? Isn't that something to watch out for? RVR will take a loooong time to turnaround. Centum had to exit RVR with a 25% loss (bought at USD.6M and sold at USD 4.5B)after holding it from 2006 to 2010.
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Rank: Elder Joined: 6/2/2008 Posts: 1,438
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mwekez@ji wrote:KenyanLyrics wrote:What about the potential for the railway? Isn't that something to watch out for? RVR will take a loooong time to turnaround. Centum had to exit RVR with a 25% loss (bought at USD.6M and sold at USD 4.5B)after holding it from 2006 to 2010. I have to agree. The railway has HUGE potential but requires MASSIVE investment and/or Govt subsidies for it to be viable. I do not currently see TCL having this muscle and CITADEL seem to have gone rather quiet.
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Rank: Elder Joined: 6/2/2008 Posts: 1,438
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With the NSE in its current mood, I am guessing that if the honchos at TCL were able to postpone their listing they surely would. Else they may have to make fake trades tomorrow between themselves to prevent a mauling of the share price tomorrow.
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Rank: Elder Joined: 9/23/2010 Posts: 2,221 Location: Sundowner,Amboseli
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mwanahisa wrote:With the NSE in its current mood, I am guessing that if the honchos at TCL were able to postpone their listing they surely would. Else they may have to make fake trades tomorrow between themselves to prevent a mauling of the share price tomorrow. And this they will to prevent a slide below KES.50, but for how long before the profit taking, and hope not, the loss taking start! @SufficientlyP
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