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RECM buys 33% of company

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Super Contributor
Very, very interesting sens. RECM are value investors. This is good enough news for me to take a spec nibble at this.
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Super Contributor
You may be right and a fair assumption. My cents worth is that your money may be locked up for a long time with theirs (Cadiz as example) RECM to me just make strange decisions (contrarian attitude?) Hope not a decision whilst on their bicycles ha,ha. In all fairness they are probably a bunch of smart guys!
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Super Contributor
Maybe, maybe not. All depends on next results set. If they start generating cash again, this is sure to rocket.
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Valued Contributor
they bought their first stake here years ago, and that's a very BIG if about generating cash again
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Super Contributor
Point is, they see value. Long term maybe, but it's there.
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Valued Contributor
they indeed do, but are they correct? RECM has under performed for over a decade but bigger issue is that they have a whole bunch of stocks, many will work many won't. You're cherry picking just one, that serious risk. If you wanna match them surely better to buy the fund not pick a few stocks?
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Super Contributor
This is purely a high risk spec buy. Many things wrong with SNU, as was with Supergroup when it was run completely into the ground by previous management. SNU has have got the right people in the right places to get this company back on track. Sure resources are out of favor and completely beaten down (and for good reason), but it won't continue forever. Their financial results is moving in the right direction. As for RECM, I still believe value investing has got a place, but with Fed and ECB market intervention that view on what constitutes value was skewed to a certain extent. I'm willing to wait and see. In the last 12 months this company has not lost shareholders much value when you look at the share price anyway. It has bottomed in my books.
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Super Contributor
You have a point here kwagga and this is maybe how the boys at RECM also see it. Hope it works out well for you and good luck.
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Regular Contributor
SNU has have got the right people in the right places to get this company back on track. That's a big statement... Exactly who are you referring to? Most of Sentula's management are the same team that got them stuck in this mess in the first place. Why back a team that already messed up?
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Super Contributor
You're talking rubbish. You obviously haven't followed the legal action against people like Casper Scharrighuisen (Founder and former MD) , Jason Holland (former CFO) in 2009 for fraud. This only happened after Robin Berry was appointed late 2007. http://www.iol.co.za/business/news/sentula-to-auction-rotten-megacube-1.1319554
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Regular Contributor
Agreed, that's the old guard. But what I mean is that this set of management have been in place from c.2010 till now.. 5 years. And Sentula has gone further backwards. Anyhow, not going to waste time convincing you otherwise. You've obviously invested in Sentula and it is your money to do with what you will.
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Regular Contributor
SNU trades at a big discount to the NAV, but there is still the risk that this will be further written down if they can't generate any cash from it. Coal contract mining, and gold exploration drilling are about the worst places to be right now, so if they are even close to breakeven it'll be very good news indeed.
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Super Contributor
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Not applicable
Don't know if the actually really put that much more capital in - seems more like shuffling from one fund to another. But my 2c worth - RECM - at 33%, their holdings in SNU, based on market cap, must be around R40m. That is a big chunk of change for a company who's only local equity fund has a total value of R150m. Where exactly does that exposure sit I wonder?
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Super Contributor
Just an interesting fact here. RECM and Calibre bought the last trance of shares. Now Calibre was stared by a guy called Theunis de Bruyn that used to the be the #1 rated analyst for the insurance sector in SA in 2000, while still in his very early thirties. Very bright CA with a few successful start up companies under his belt. iVolve Technologies & Calibre to name but two. I trust that when these guys buys into a 20c share, they do so for a good reason. Penny share or not. http://whoswho.co.za/theunis-de-bruyn-58351
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