Northern Linked Offer

[thebarns]

Well the post just delivered my cheques back from Northern today !!!

All 3 rejected and I put my application in the postbox 2 hours after the applications went up on their website !!!!!

Thanks for nothing Northern.

A loyal investor for a good number of years who has invested on more than one occasion already.

That is how you treat loyal investors, they will remember.

Shambles.

You don't care anyway.

I will now use this family's money to invest in my good lady's pension and receive an immediate 67% return, beats yours by miles, thanks.

[BusyBumbleBee]

A loyal investor for a good number of years who has invested on more than one occasion already.

I simply don't understand why you don't use the DRIS - it is guaranteed that you get the shares and you get them at NAV for Northern and NAV- 5% for the Brit Smaller. We have had massive dividends from both this year (and last) and taking it up would save you the hassle of the last minute postal lottery.

I have been doing this for years and of course it compounds very nicely.

However, I may not continue as Brit Smaller was a one shot wonder with nearly all the return coming from one company (Go Outdoors) and one wonders if Northern can adapt to the new rules.

[thebarns]

BBB,

I take your point on the DRIS.

However Mrs thebarns and thebarns brats have used those dividends over the years !

I get the point and I do still think an offer is a slightly different issue and also capable of handling larger sums, especially as some of the dividends are one off specials.

It would not have beyond the wit of man to come up with a far fairer method of allocating this offer.

However, rant over, I will let this go now !

Mrs thebarns tells me she does not want these returned cheques to go into her pension, but wants a Florida holiday for her and the brats - I can't win either way !!!!!!!!!

[timbo003]

I simply don't understand why you don't use the DRIS - it is guaranteed that you get the shares and you get them at NAV for Northern and NAV- 5% for the Brit Smaller. We have had massive dividends from both this year (and last) and taking it up would save you the hassle of the last minute postal lottery.

I completely agree BB, DRIS is the only way to go given the increased demand and decreased supply.

The missus started doing DRIS earlier this tax year (for all her VCTs which run a scheme) and so far it has accounted for around half of her income tax liability for this tax year. EIS subscriptions into AIM IPOs and placings have accounted for another third, so she opted to subscribe for a few shares in the Northern offer to tidy up her affairs for this tax year. Alas, she has suffered the same fate as theBarnes, with her cheque returned in the post this morning. This was despite posting the form on the same day as the offer came out and from a main post office in the SE (Horsham). I think she now wishes she had started to do the DRIS earlier in the year. I did tell her several times to start doing DRIS early, but I have now quickly learned that it is unwise to keep reminding her about that.

I suspect the Q&A session at the forthcoming Seminar on February 28th will now be dominated by questions on the fund raising from discontented shareholders.

On a related subject, there is a bit of good news for Northern VCT shareholders (and other interested investors) who live in the tundra and cannot get down to London for the forthcoming Northern Investor Seminar, as Tim Levett will be doing a presentation at the next ShareSoc Investor Seminar on Tuesday February 21st in Manchester, see link for details:
http://www.sharesoc.org/altrinchamseminar.html

It is free to attend for ShareSoc members and there is only a small charge to non-members to cover the costs of refreshments after the event.

[scotia]

I'll join the queue of disgruntled failed Northern investors
I downloaded the form at 8:02am, filled it in, and drove to the Post Office delivery office in a sizeable town about a dozen miles north of Glasgow, and handed it over (first class post) around 9:40am. It is difficult to know how it could have reached Newcastle any sooner (unless I used a courier service).
It seems unlikely that the post would be delivered to NVM in dribs and drabs, so I suspect my application arrived with many others, and a fortunate few were selected by some opaque process.
NVM - if you are listening - definitely not well done

PS - I contribute to Northern and British Smaller Cos DRIS

[james188]

This will probably be a minority point of view, but I far prefer the Northern process to the one currently on offer from British Smaller Companies - a Faustian pact if ever there was one, given the huge freeze period it entails this late in the tax year.

We all knew that the Northern offers would sell like hotcakes and that demand would massively outstrip supply. We also knew the rules and exact timing in advance (that does not happen very often, but it should), so it came down to what people were prepared to do to maximise their chances. If I had applied by post, I would have certainly paid for the Post Office guaranteed by 9.00am next day delivery (as flagged by a previous poster and discussed several times in the past on the Motley Fool Boards). A standard e-mail I received from Clubfinance a couple of days ago indicates that anyone who did that would have been successful with their application.

I decided that even that method might not work, so I took an early train up to Newcastle from King's Cross (great value - under £100 for a pre-booked first class return ticket), had a decent breakfast on the way whilst reading the Offer Document on-line and filed my application at NVM's offices mid morning. I was by no means the first visitor, but nor was there a stampede. I suspect that several IFAs and others used same day courier services and I also think that this sort of thing will probably become more commonplace for the best offers in future years, as it looks as if product is going to be fairly limited relative to demand.

I can think of two measures which might help, to a degree, but neither is by any means perfect. First, a cap on the total amount invested by a single investor could be applied to prevent very large applications eating up the allocation too quickly. Secondly, although perhaps at the edges,initial priority could be restricted to those with a material holding (say £6,000, being the minimum application size for the Northern offers) to stop someone buying £100 of shares in the secondary market having the same rights as long term holders. That said, I don't think that there is a perfect solution, because there will be winners and losers whichever method is selected.

[UncleEbenezer]

Bah. You lot got it easy: cheques returned already. This is orderly and well-managed compared to that Baronsmead 5 fiasco, where my cheque got cashed (thereby confirming, I thought, that I'd succeeded), and I didn't learn that I'd missed out until much later.

If British Smaller get oversubscribed on anything like this scale then it is a lottery, and they're just being honest in describing it as such.

[Vulgaris]

Far preferable to BSC, where money is tied up for weeks whilst other options (Albion and possibly Hargreaves Hale) fill up. Also preferable to Baronsmead, who are poorer at communicating when the starting gun has been fired.

I'm waiting to hear if applications were successful, having been assured that, sent special delivery at noon on the 7th from Norwich, they were signed for at 0805 on the 8th in Newcastle. This was despite having been sent to NVM's previous address (Princess Sq rather than Time Central) which was 'helpfully' distributed by Chelsea Financial....

Whatever the outcome, PO are to be congratulated for correctly re-directing them.

[scotia]

Courier Service, travel by train etc - what a needless waste of human resources to deliver a cheque. Is it supposed to be an obstacle race with infirm or geographically distant investors disadvantaged?
There are numerous means of delivering documents and money electronically from any part of the country.
I think the British Smaller approach makes much more sense - albeit it should have been carried out much earlier in the financial year.
And I would suggest a modest maximum amount - e.g. £10000 to ensure that a substantial number of applicants could be satisfied. A second application above this limit would also be allowable - and would be considered if the first round did not fill up the offer.
And yes - as others have written - an alternative would be a rights issue.

[thebarns]

Well done to the investor that planned his train trip.... Absolutely covering all angles.

However, are we all supposed to take a holiday and book our train trips ?

So what about those that are working/elderly/overseas/incapacitated/etc.

What nonsense !

A rights issue ? Possibly.

Is it really that difficult to offer it to all existing shareholders within a 2 week period, either in proportion to existing shareholdings or alternatively with a an appropriate maximum and minimum cap offered to all shareholders irrespective of shareholding size ?

No, it's not that difficult nor that expensive administratively and could easily have been done with a modicum of foresight and planning.

[UncleEbenezer]

No, it's not that difficult nor that expensive administratively and could easily have been done with a modicum of foresight and planning.

Well now that you mention it, Foresight have just launched a new offer. Get in there!

On a serious note, we did have that discussion (and some horses-mouth feedback relayed by - from memory - timbo) after the Baronsmead fiasco a couple of years ago. Anyone have enough record of that to devise the right search term to google?

[Retiringat51]

This sounds like the inspiration for a new series of Wacky Races.

[timbo003]

On a serious note, we did have that discussion (and some horses-mouth feedback relayed by - from memory - timbo) after the Baronsmead fiasco a couple of years ago. Anyone have enough record of that to devise the right search term to google?

I remember it well uncleE, there were two Baronsmead meetings where this issue dominated the Q&As:

B1 AGM (March 2016): http://boards.fool.co.uk/im-still-suffe ... 43233.aspx
B5 AGM (April 2016): http://boards.fool.co.uk/baronsmead-5-a ... 64127.aspx

There is no universal solution I am afraid

If cost were not an issue, I would prefer Tom's idea of a rights issue with all shareholders awarded nil paid rights which would be listed and tradable (can anyone come up with an actually cost estimate for this sort of exercise?)

On the assumption that a rights issue could be ruled out on cost grounds, my preference would be for an open offer with the ability to put in for an over subscription.

Assuming neither of these are going to happen for the popular generalists, I think the most sensible option is for existing shareholders to subscribe to the DRIS schemes run by Mobeus, Northern and YFM.

[timbo003]

I remember it well uncleE, there were two Baronsmead meetings where this issue dominated the Q&As:

I should add that there is another Baronsmead AGM coming up next week (Baronsmead 2nd Venture) where I suspect the issue of future share offers will get another good airing. I intend to go along to that one and will report back in due course.

Unfortnutately, I will not be able to attend the Northern Shareholder Seminar on Feb 28th as I'll be in the USA, and the ShareSoc seminar with Northern presenting on Feb 21st is a bit too far to travel for an evening meeting.

[thebarns]

Uncle Eb, very droll !

Albion to the first person who can as Amati of fact, inVentus a fair procedure, which will prevent me from Downing tools, perhaps consulting the Elderstreetwise VCT investors, Titans of this board, and will Hale their efforts, especially if it prevents me from being Pembroke !

[BusyBumbleBee]

On the assumption that a rights issue could be ruled out on cost grounds, my preference would be for an open offer with the ability to put in for an over subscription.

Assuming neither of these are going to happen for the popular generalists, I think the most sensible option is for existing shareholders to subscribe to the DRIS schemes run by Mobeus, Northern and YFM.

I would Albion to that list

However, there is another alternative. If a VCT offers a DRIS then it is obvious to the VCT that the subscribers to this are loyal shareholders. Why not just offer them the option to subscribe for more shares as part of the DRIS.

Last figures from NVT showed 20% of dividends reinvested by way of the DRIS which considering they paid out £12,242 in dividends is nigh on £2.5 million and they only tried to raise £4.3 million by way of the offer. Put another way if everyone took up the DRIS in a normal year - 6 pence dividend on 100 million shares they would raise about £6 million which is equal (roughly) to the current DRIS take up with the DRIS take up %

[moorfield]

I simply don't understand why you don't use the DRIS - it is guaranteed that you get the shares and you get them at NAV for Northern and NAV- 5% for the Brit Smaller.

Coming back to the question about DRIS - has anyone purchased on the secondary market (presumably as a nominee holder) and used DRIS via their broker? And would any new DRIS shares then come with income tax relief. Just wondering.

[timbo003]

Coming back to the question about DRIS - has anyone purchased on the secondary market (presumably as a nominee holder) and used DRIS via their broker? And would any new DRIS shares then come with income tax relief. Just wondering.

Yes, the missus has done this with a number of VCTs, but she has either purchased as certificates (Jarvis are the best broker for this), or purchased in a nominee and then re-materialised the shares into certificates in her own name before signing up for DRIS.

[oxmatt]

Has anyone had a positive confirmation yet? I received my cheque and rejection for N3 on Saturday but have not heard anything for N1 or N2 as yet.

[james188]

I have heard nothing yet from either NVM direct or from Clubfinance, but I thought that it would take them a while to sort everything out. I would guess that Northern Venture Trust in particular would have been very popular and so some applicants (if they ticked the appropriate box) will have been switched into one of the other two VCTs. It would be interesting in due course to have a broad breakdown of the number and size of successful applications in bands - say those under £50,000 (total investment), those between £50,000 and £100,000, those between £100,000 and £150,000 and those in excess of that.