Chrysalis VCT: liquidation

[127tolmers]

As Coolabi was their largest asset to dispose of, you might want to check the Coolabi CH website for updates.

[BusyBumbleBee]

As Coolabi was their largest asset to dispose of, you might want to check the Coolabi CH website for updates.

Couldn't find the website refereed to but did find this: https://www.rns-pdf.londonstockexchange ... -11-29.pdf The annual report of EDGE VCT which gives a very good explanation of their concerns about Coolabi. Worth a read. If you are lazy - like me - then just search the document for Coolabi : there are 37 references.

[127tolmers]

BBB, here is the link.

https://find-and-update.company-informa ... ng-history

[wilwak9]

Interesting

Do we know what’s going on? Has Coolabi been sold?

There’s lots of notifications of Edge and directors no longer having significant control.

Either the company has been sold to a new owner or a new investor has arrived and the existing shareholders have all been diluted.

[BusyBumbleBee]

BBB, here is the link.
https://find-and-update.company-informa ... ng-history

Thanks for this : it seems that Chrysalis [from the Confirmation statement made on 17 March 2019 with updates document] own a mere 216,318 shares whereas EDGE owned in excess of 7.5 million and 10 million preference shares

Most if not all of EDGE's seem to have been sold earlier this month see "Cessation of Edge Performance Vct Plc as a person with significant control on 4 June 2021"

[wilwak9]

It not totally clear but it seems that £3m of the £5m Chrysalis Coolabi valuation is a loan.

The remaining £2m is the value placed on the small shareholding.

Again it’s not totally clear but it appears that Edge value the shares at a far lower value than Chrysalis do. (Edge own 49.99%)

So even if Coolabi has been sold and Chrysalis has sold its shares there’s no guarantee that the loan has been repaid too.

I asked Downing in March when we are likely to get a Chrysalis shareholder update….. they said ‘very soon’??

[Kidman]

My understanding from the references above is that Coolabi has been bought by Quest Digital on 4 June 2021.

Looking at the filings for Quest Digital we see Chrysalis VCT named as one of more than four entities who are involved in a charge. My guess is that the various loans due from Coolabi are now due from Quest Media.

Chris Kay has signed the 56 page document in the presence of Samantha Millar on behalf of Chrysalis VCT.

Whilst the liquidators may have received some money from Quest Digital for the Coolabi shares I suspect they will have to wait some time for the loans to be repaid.

[Kidman]

Based on a few searches and 'two and two making five', it may be that Coolabi, which is now owned by Quest Digital, has become part of a group known as the Talenthouse Companies, which in turn is owned by New Value AG, a Swiss investment company (https://www.newvalue.ch/home/)

[127tolmers]

https://www.pressetext.com/news/20210615035

[127tolmers]

https://www.investegate.co.uk/edge-perf ... 00071655C/

[wilwak9]

Nice detective work!

They imply that Edge have sold Coolabi at a price not materially different to its last NAV valuation.

Whilst that sounds positive …. in Edge’s last accounts they applied a 50% write down to Coolabi.

The last published Chrysalis NAV valuation was prior to that and therefore it seems that Chrysalis may have taken a big hit on their share valuation.

The share structure seems a little complex so nothing is certain but I wouldn’t be surprised if the shares previously valued at £2m have been sold for very little indeed.

I’m hoping that the loan of £3m is being repaid at full face value and that the interest has been paid to date.

Last time I did a quick calculation then each £1m of NAV equated to about 3p of NAV so after Coolabi completes maybe we will see 10-15p of cash back??

[Kidman]

I’m hoping that the loan of £3m is being repaid at full face value and that the interest has been paid to date.

Last time I did a quick calculation then each £1m of NAV equated to about 3p of NAV so after Coolabi completes maybe we will see 10-15p of cash back??

Don't hold your breath!

I agree with your suspicions that the Coolabi shares didn't raise anything like Chrysalis had hoped and I believe that the loan has been rolled over to the new owners so is not being paid back - yet.

[yorkshirelad1]

Update on the liquidation (by e-mail from Downing)
Letter dated 28 June 2021.
available from https://www.downing.co.uk/existing-inve ... ysalis-vct

Most pertinent point is the sale of Coolabi

Coolabi, the media group specialising in children intellectual property rights, has been sold in a deal that is expected to complete on 30 July 2021. Assuming the transaction completes as planned, Chrysalis expects to receive proceeds of approximately £4,254,000. This compares to the last valuation on £4,257,000 at 30 September 2020. We believe this is a good outcome, with full cash proceeds expected on completion. There are two other smaller disposals which I am optimistic will complete over the coming weeks. Negotiations are also ongoing in respect of a number of transactions, which I am hopeful will lead to the realisation of the remaining investments in the second half of this year.

Also change of Registrars

In order to significantly reduce the costs of making distributions, the Company has appointed The City Partnership to act as its registrar with effect from 30 July 2021, to replace Link Asset Services. Full details for The City Partnership will be provided in due course.

[yorkshirelad1]

I sent an e-mail to the managers asking about the new registrars and payments via BACS and e-mail communications and have had a very helpful and prompt reply:

I can confirm that email preferences and bank details will be transferred over to The City Partnership so wherever possible you should get email communications and distributions paid directly into your bank account. I believe dividend vouchers may still need to be sent to you by post though but I will discuss with City. I believe we will find City much more accommodating than Link have been in these sort of matters in the past.

Obviously, the above applies to direct shareholders, and if you hold the liquidating Chrysalis VCT shares in a nominee, it'll be via the nominee.

[scotia]

From the April 2020 half-year report the no of shares =28,472,025
Expected cash from Coolabi sale = £4,254,000
So cash per share from Coolabi sale = 14.94p

[BusyBumbleBee]

So cash per share from Coolabi sale = 14.94p

My entry into the (virtual) Sweepstake on the first distribution is 20p per share by the end of July.

[Kidman]

On Friday I received my hard-copy version of the recent announcement and it sounds remarkably positive.

I was rather amused by the claim at the top of the latter in the address block which says "Chrysalis VCT is a leading UK Venture Capital Trust".
Surely a VCT in liquidation can't be "leading", indeed it isn't even still a normal VCT. Perhaps "is" should have been changed to "was"?

[wilwak9]

I hold my shares in a Barclays nominee account and I also requested Downing to send me any shareholder communications directly which they promised to do.

I’ve received nothing from either!

It’s a bit crazy that I have to rely on this forum my updates.

Anyway, it does all seem a lot more positive than I feared and selling all the remaining investments in the second half of this year is superb if the values are ok.

A 20p per share dividend in the coming months would be a great start.

[BusyBumbleBee]

Hmm... The deal for Coolabi was due to complete on 30th July : does any one know if it did?

[wilwak9]

No news anywhere that I can see??