Mercia reports tomorrow. Its got a merky rep and price...but tomorrow I think its going to bop

Its a company with a fair degree of disinterest and disappointment kicking around. PI support waned hugely on their Dec 2019 fund raise feeling both peeved that they did it and then double annoyed that it wasn't done as a rights issue for existing shareholders.

The stock was in a hole back then. It was clear if one analysed the available info that they were likely to do a raise. They had been signalling that they were not yet at the stage of profitably realising balance sheet investments and that made it obvs that they needed more investment capital...

That put it in a hole as they were caught with a bad shareholder register with Woodford and Invesco as dominant key holders. How can you raise with those guys ruling the roost?

They pulled off the raise by tagging in the sweetener acquisition of Northern Ventures and their 3 VCTs. The good things about that is takes their asset management activities to an earning positive position. This activity seems to have something between low and zero value attached to it by the market.  Overall, its looks like a good deal.

Overall, I think PIs had been neglectful of reality not to see the funding issue coming and then threw their toys out of the pram through exasperation and frustration at lack of share price appreciation. Pre the Dec 2019 raise I'd built an initial position in 27p area...even though value looked great was cautious of taking too much. Then I took part in the accelerated book build...I bid at 20.5p and was knocked back and everyone was corralled in at 25p. I felt the brokers had done exceptionally well to get a 25p price given the shareholder register etc and so I only took part lightly as my hunch was that between raise and final results newsflow was unlikely to be very positive (its a J curve business so little bad news is likely before big good news)...

...then came covid and the price headed south I "filled my boots" in the 14p area. It seemed a give away for something that had clear value underpin and growth upside.

I don't buy for value but its nice if you can get. I think…

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