Good morning! As expected, there's very little in the way of company announcements today, what with it being Christmas Eve, but as mentioned yesterday, I like to keep monitoring the market over this period because there have been some interesting buying opportunities thrown up in previous years, caused by a mixture of illiquidity and clumsy year-end portfolio rebalancing by Institutions.



One of the potential buyers for Albemarle & Bond Holdings (LON:ABM), Better Capital, has dropped out of the sale process, as announced today. The company goes on to say, "The Board confirms that the formal sales process is on-going and that it is continuing discussions with a number of interested parties". I'd be surprised if anyone buys it in its current form, because it's trading at EBITDA negative, but you never know. The shares are really now little more than gambling tokens, with a (probably) binary outcome. Hence I am avoiding these shares.





In a similar vein, another turnaround situation which has gone somewhat better, is United Carpets (LON:UCG). Unusually, this carpet retailer went through a pre-pack Administration process, and remained Listed. So having ditched the loss-making shops, and renegotiated rents down on the remaining shops, the company now has a low cost base, and a clean Balance Sheet. This pre-pack process is tough on suppliers and other non-secured creditors, who are stuffed with the losses, so it's a controversial process. On balance though, it saves jobs and enables the viable parts of troubled companies to continue trading.

Also, to be blunt, nobody who has proper financial controls should be supplying goods on credit to any company that is at risk of going bust. If they do, then that's a risk they have chosen to take (actively, or by omission), hence the consequences follow.

Shares in United Carpets have more than doubled in the past six months, and the market cap is still only just under £4m. They are horribly illiquid as a consequence, and I've found it almost impossible to get hold of any stock, so you have to wonder why they bother with a Listing?

Their last set of results here looked encouraging, although I'm not sure what the cyclicality of carpet sales are…

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