Good morning!

I will scroll back and look at events from earlier in the week, once I've covered today's news.

Now let's catch up on two stories from ealier in the week:




Thomas Cook (LON:TCG)

  • Share price: 8.5p (-36%)
  • No. of shares: 1536 million
  • Market cap: £130 million

The fat lady is singing for shareholders at Thomas Cook (LON:TCG), where the proposed recapitalisation envisages that "significant amount of the Group's external bank and bond debt will be converted into equity". Commiseration to anyone who is holding this.

We've not written much about Thomas Cook in this report. For me, there were two obvious reasons: 1) until recently, it hasn't qualified as a small-cap, and 2) the writing has been on the wall that the equity was headed for disaster, so there would be little to say.

IG says that these shares are unborrowable, but I know one or two bears who managed to open short positions - well done to them!

Prospects remain extremely bleak, even at 8.5p. If the company avoids administration and has an orderly recapitalisation, the best-case scenario that I can imagine for existing holders is that the fundraise happens at 1p (putting a value of £15 million on the existing equity).

The only reason for creditors and new equity investors to offer crumbs to the existing equity is to get the recapitalisation voted through. But if shareholders reject the recapitalisation, then administration beckons and with it, the likelihood that they get nothing at all.

Needless to say, I reckon these shares are uninvestable - further downside to come of at least 90%.



Audioboom (LON:BOOM)

  • Share price: 255p (unch.)
  • No. of shares: 14 million
  • Market cap: £36 million

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