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ShareSoc Blog

This blog gives you the latest topical news plus some informal comments on them from ShareSoc’s directors and other contributors. These are the personal comments of the authors and not necessarily the considered views of ShareSoc. The writers may hold shares in the companies mentioned. You can add your own comments on the blog posts, but note that ShareSoc reserves the right to remove or edit comments where they are inappropriate or defamatory.

There is more news given in the News page of our web site and more analysis of news is provided in our monthly newsletter for members – see the Newsletters page.

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RIT Capital Partners, Foresight 4 VCT and Sepsis

RIT Capital Partners (RCP) is an investment trust that recently issued its interim report. As one of my longer standing holdings, first purchased in 2003 although I have reduced my holding of late, I read the report with interest. RCP has been a long-standing favourite of private investors having traditionally taken a somewhat defensive investment approach. But the portfolio is now most peculiar. It contains 8.8% of “quoted equities” but many of them are held as “swaps”, 27.7% in “long-only funds”, ...

Shareholder rights, letters to MPs and questions at AGMs – An Update

Over 20 members have to my knowledge written to their MPs (as we requested) and a number of members have asked questions at AGMs. We have certainly raised the issue. The Minister (or most likely his civil servants) have produced what looks like a standard response which is being sent to those MPs who contacted Greg Clarke MP, the Secretary of State. Their response argues that the UK does not have to follow the intent of the EU Shareholder Rights Directive and ...

Firmer, faster, more transparent action needed by FRC, we tell Kingman

UKSA and ShareSoc responded jointly to Sir John Kingman’s review of the Financial Reporting Council (FRC). We summarised our assessment of the FRC’s current strengths and weaknesses and made suggestions for addressing the weaknesses. The main points we made were: Our main desired outcome is firmer and faster action against those who violate the integrity of reporting standards. It seems to us (and to the general public) that in practically every financial scandal or financial crisis, the FRC seems to have taken ...

House of Fraser Pre-Pack – Is It Such a Great Deal?

The acquisition of House of Fraser by Sports Direct is a typical “pre-pack” administration. In administration one minute, sold the next. The national media promptly welcomed it as the rescue of everyone’s favourite department store, the protection of 17,000 jobs and just what is needed to help save Britain’s High Streets. Mike Ashley of Sports Direct trumpeted this as a great deal. All the stores and stock were purchased for £90 million when gross assets were £946 million and the company made ...

Clarification re Stock Lending and platform pooled nominee accounts

Kevin Taylor, a ShareSoc member, has pointed out to me in relation to my article page 12 of ShareSoc’s August newsletter, that stock-lending simply does not (should not under FCA rules) take place from standard pooled nominee accounts, the likes of which most retail investors would use.  The FCA’s rules could not be more explicit in this area: “A firm must not undertake or otherwise engage in stock lending activity with or for a customer unless … the firm has obtained the consent ...

Beaufort Client Campaign: Update 4

Following much hard work by the creditors' committee, PwC has now drafted an official distribution plan, in line with our previously stated understanding. Full details of the plan can be found here: https://www.pwc.co.uk/services/business-recovery/administrations/beaufort/distributions.html It was approved by the creditors' committee on 13th July and by the Court on 26th July. I attended the court hearing - more on that later. It is anticipated that the vast majority of client assets will be transferred to another broker in September, without loss or costs payable by ...

Stopping Another Beaufort Case

Readers are probably aware of the administration of stockbroker Beaufort, how PwC are running up enormous bills to the disadvantage of creditors and how they also claimed to be able to charge the bills against client assets under the Special Administration Rules. See here for more information if you are not familiar with this debacle: https://www.sharesoc.org/campaigns/beaufort-client-campaign/ I hope all stock market investors have already written to their Members of Parliament on this topic, not just to get the Special Administration Rules changed ...

RedstoneConnect (Smartspace Software) AGM and Branding

Today (30/7/2018) I attended the Annual General Meeting of RedstoneConnect Plc (REDS) which was promptly renamed Smartspace Software Plc at the meeting. Although there were only a few ordinary shareholders present, this proved to be an informative meeting. It was chaired by new Chairman Guy van Zwanenberg. With former CEO Mark Braund having departed recently after major disposals leaving the company to focus on the remaining software business, the new CEO is Frank Beechinor who was the former Chairman. Frank is also ...

Shareholder voting consumer platforms

The AIC are to be congratulated on this survey. https://www.theaic.co.uk/aic/shareholder-voting-consumer-platforms The survey was conducted by the lang cat on behalf of The AIC, and looks at practices with respect to voting for Investment Trust shares. But it looks to me to be a pretty good summary of their voting services for all UK shares. It seems like Fidelity have decided to follow good practice. But it seems HSBC and Bestinvest are still refusing to offer a voting solution, which is quite disgraceful. When will they ...

Dowd Report On Cost Of Guarantees Linked To Equity Release Mortgages

Press Release 105 - Joint Press Release from UKSA and ShareSoc on behalf of individual investors Dowd Report On Cost Of Guarantees Linked To Equity Release Mortgages UKSA-ShareSoc welcome the publication of Professor Kevin Dowd's report on the valuation of embedded guarantees in equity release mortgages, which raises troubling questions about the quality and transparency of corporate reporting. It also raises concerns about the opaque relationship between regulators and regulated firms. Equity release mortgages allow people over the age of 55 to borrow a proportion of ...
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