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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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Two more AIM Exits – Ludorum and Armour Group

Two more departures from AIM were recently announced - Ludorum (LUD) and Armour Group (AMR). Ludorum have been developing a market for their animated children's TV series based on Chuggington trains and associated consumer products. But revenue has never really taken off as investors hoped. Along with the interim results announced on the 15th December (again somewhat disappointing), the company announced a proposed delisting from AIM.  These are the reasons given in the announcement: The factors taken into consideration by the Directors in ...

Better Finance comments on the EU Shareholder Rights Directive

Better Finance, a representative body for European shareholder associations, has issued a press release commenting on the review of the Shareholder Rights Directive. It points out a number of defects in the proposals. Here are extracts from the press release: "Guillaume Prache, managing director of Better Finance has stressed that many individual shareholders of EU companies will still have to pay high fees to exercise their voting rights across borders within the EU. If the internal market for capital is to carry ...

Vanguard backing shareholder committees

According to a report in the Financial Times this morning, Vanguard is to promote the idea of "shareholder liaison committees" to improve corporate governance. This is of particular significance because Vanguard is one of the largest investment groups in the world and overtook Pimco last year to become the second largest fund manager.  Vanguard primarily runs low cost index tracker funds and therefore has to hold all major companies. Indeed they are one of the largest holders of shares in many ...

Chancellor’s Autumn Statement – What’s in it for investors?

The Chancellor's statement yesterday was clearly aimed at the typical house buying, ISA invested, traditional Conservative voter, anticipating the May general election next year. The reform of stamp duty on houses is surely rational, but won't necessarily have a lot of impact on those who already own a house other than at the very top end in London. The share prices of Berkeley Group and Foxton's fell on the announcement but soon recovered. Other housebuilders were viewed as benefiting however. Apart from ...

Closet index trackers – are you paying over the odds?

Organisation Better Finance, a representative body for European individual investors, have raised the issue of " closet index trackers" and their fund management charges. It is suggested that many funds who pretend to be "active" in nature (as opposed to simple index trackers or passive funds) are not in reality because they hold very much the same stocks as index funds. This means that their performance is very similar to index funds. However, they charge management fees that are more like ...

BP and Shell facing climate change resolutions

Both BP and Shell are likely to face resolutions at their next AGMs which will raise the issue of climate change. A coalition of investment groups including ShareAction and the Local Authority Pension Fund (LAPF) are looking for signatories to a requisition for a resolution to require more reporting by these companies on various aspects of their approach to carbon reduction and emissions management. See http://www.lapfforum.org/news/co-filers-sought-for-2015-shell-and-bp-agm-resolutions for more information. Comment: Some investors feel that the Annual Reports of such companies are already ...

AIM delistings – Security Research and Rethink

Delistings of AIM companies always distress investors. Out of the blue your shares in a company can drop in value very substantially, and you can be left holding an unsaleable stock. Two recent announcements of delistings have been Security Research (SRG) and Rethink (RTG). These are both companies with patchy trading histories and low market capitalisations (£9m and £5m respectively after the announcements). It requires a vote of 75% of shareholders to approve delisting. In the case of Security Research the General ...

ShareSoc Welcomes BG Group Decision but calls on Sir John Hood to Resign

ShareSoc is delighted by today’s news that BG Group has decided to withdraw the conditional share award that was proposed for new CEO Helge Lund. This is a good illustration of active shareholders being able to influence corporate policy and restrain abuses. However, today’s announcement, including acceptance by Mr Lund of the revised terms, clearly demonstrates that the original proposal was excessive and unwarranted. It is obvious that insufficient consultation with shareholders had been conducted before the proposed package was announced, as ...

Bradford & Bingley & Northern Rock Bond Tenders

Bradford & Bingley Plc have announced a new tender offer for the subordinated bonds. These are what were formerly called PIBS which were issued before the company converted to a bank. These bonds remained outstanding when the company was nationalised in 2008 and have continued to be listed and tradable. But the previous tender offers were not considered very generous, although the market price has been slowly recovering on the expectation that the mortgage assets of the company would exceed its ...

Tesco Legal Action – or should we just “put our hands up”?

Law firm Stewarts Law has announced that it is preparing a case against Tesco based on the losses of investors in the company from the overstatement of profits. To quote from their announcement: "The Claim will allege that directors and senior management knew or were reckless as to whether Tesco's statements to the market were untrue or misleading and/or dishonestly concealed the true position, in breach of the Financial Services and Markets Act". They don't intend to await the results of ...
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