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John Laing Environmental Assets Group (JLEN)

Closed-end funds and OEICs
richfool
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John Laing Environmental Assets Group (JLEN)

#409476

Postby richfool » May 5th, 2021, 9:04 am

Rather than mix this in with existing Green Renewable energy threads on the Investment Strategies board, I've started a topic specifically for JLEN, under Investment Trusts.
JLEN Environmental Assets Group Limited
Proposed Placing

JLEN Environmental Assets Group Limited ("JLEN" or the "Company") today announces that it is proposing to undertake a placing for up to approximately 54.7m new ordinary shares ("New Ordinary Shares") by way of a bookbuilding process (the "Placing").

The New Ordinary Shares are being offered on a non-pre-emptive basis pursuant to the authority granted by shareholders at the Company's annual general meeting held on 3 September 2020, and therefore the maximum number of New Ordinary Shares that will be issued under the Placing is 54,672,002 New Ordinary Shares, representing approximately 10 per cent of the Company's issued share capital.

To participate in the Placing, investors should communicate their bid(s) to Winterflood Securities Limited ("Winterflood"), including: (i) the number of New Ordinary Shares for which the investor wishes to subscribe; and (ii) the price or price range the investor is offering to pay for such New Ordinary Shares. Any bid price must be for a full pence or half pence amount.


https://www.investegate.co.uk/jlen-envi ... 00085904X/

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Re: John Laing Environmental Assets Group (JLEN)

#409795

Postby airbus330 » May 6th, 2021, 12:40 pm

Not a great way to treat the private share holders. :(

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Re: John Laing Environmental Assets Group (JLEN)

#409800

Postby Dod101 » May 6th, 2021, 1:29 pm

airbus330 wrote:Not a great way to treat the private share holders. :(


It is not but it seems the usual way unless they involve Primary Bid which does give the private, non institutional shareholder at least a chance, I doubt though that they would want to or possibly could participate in an auction. JLEN are giving two fingers to the private shareholders. Were I a shareholder, which I am not, I would be in touch with the chairman, complaining. Always worth the effort.

Dod

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Re: John Laing Environmental Assets Group (JLEN)

#409894

Postby airbus330 » May 6th, 2021, 6:59 pm

Thanks Dod, I may well do that, or at least Tweet something bitter and twisted! I am normally fairly phegmatic on poor choices of shares, but something about the high handedness of this really hacks me off. I might just sell and put my losses somewhere else.

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Re: John Laing Environmental Assets Group (JLEN)

#409905

Postby heathmount » May 6th, 2021, 7:38 pm

Hi

Could someone explain to me in laymans terms what this placement announcement actually means? I've held JLEN for a few years as part of my IT portfolio and have been happy with the performance. I've also got a top up in place with AJ Bells regular dealing day on Monday but this announcement is giving me second thoughts as I have no idea what it means!

Thanks
Heathmount

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Re: John Laing Environmental Assets Group (JLEN)

#409906

Postby Dod101 » May 6th, 2021, 7:43 pm

airbus330 wrote:Thanks Dod, I may well do that, or at least Tweet something bitter and twisted! I am normally fairly phegmatic on poor choices of shares, but something about the high handedness of this really hacks me off. I might just sell and put my losses somewhere else.


Yes, it certainly sounds highhanded and the thing is nothing will change unless shareholders complain. I have found IT chairmen are almost always very approachable but that is the traditional ITs. I do not have a lot of experience with this sort but it should make no difference. At the very least I would try to get an email for the Finance Director and complain to him. The trouble is that they want an easy life and a placing is usually easy to do and much cheaper than the traditional rights issue.

Dod

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Re: John Laing Environmental Assets Group (JLEN)

#409931

Postby UncleEbenezer » May 6th, 2021, 10:14 pm

heathmount wrote:Hi

Could someone explain to me in laymans terms what this placement announcement actually means? I've held JLEN for a few years as part of my IT portfolio and have been happy with the performance. I've also got a top up in place with AJ Bells regular dealing day on Monday but this announcement is giving me second thoughts as I have no idea what it means!

Thanks
Heathmount


I too have held JLEN for quite a while.

Placings serve to raise more funds, which is something that happens regularly in this renewable-infrastructure sector to acquire more assets. It's likely to be cheaper and simpler for them than a full-blown rights issue, but it excludes private investors, unless you can do something inventive to qualify. Hence disgruntled Fools.

I'm mildly disgruntled myself, but also recognise that it's common practice, and not the most egregious example (which is when a placing is seriously discounted).

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Re: John Laing Environmental Assets Group (JLEN)

#409956

Postby airbus330 » May 6th, 2021, 11:33 pm

UncleEbenezer wrote:
heathmount wrote:Hi

Could someone explain to me in laymans terms what this placement announcement actually means? I've held JLEN for a few years as part of my IT portfolio and have been happy with the performance. I've also got a top up in place with AJ Bells regular dealing day on Monday but this announcement is giving me second thoughts as I have no idea what it means!

Thanks
Heathmount


I too have held JLEN for quite a while.

Placings serve to raise more funds, which is something that happens regularly in this renewable-infrastructure sector to acquire more assets. It's likely to be cheaper and simpler for them than a full-blown rights issue, but it excludes private investors, unless you can do something inventive to qualify. Hence disgruntled Fools.

I'm mildly disgruntled myself, but also recognize that it's common practice, and not the most egregious example (which is when a placing is seriously discounted).


The problem with this offering, assuming I understand it properly, is that no-one knows what the buying price is. I think from the SP performance of the last few weeks we can assume that they are going to be selling this slug of shares on the cheap when the bids come in from the big investors. Of course, all this grumbling will disappear if they invest smartly, increase NAV and boost the divi. Which is, after all, what we pay them to do.

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Re: John Laing Environmental Assets Group (JLEN)

#409965

Postby UncleEbenezer » May 7th, 2021, 12:13 am

airbus330 wrote:The problem with this offering, assuming I understand it properly, is that no-one knows what the buying price is.

That too is not unusual.

Not so long ago a share I hold was subjected to a tender offer at a price formula subject to bidding[1]. They determined how much was to be spent, and invited bids from shareholders - private and institutional alike. The price would be set according to demand, so that everyone who tendered below it would get bought out in full, those above it would keep their shares, while those at the exact price would get scaled back.

Come to think of it, IPOs (often?) come at a price only announced after bids are in!

[1] I'm not quite sure, but I think it was the Whitbread return of capital after they sold off Costa Coffee.

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Re: John Laing Environmental Assets Group (JLEN)

#409981

Postby Dod101 » May 7th, 2021, 6:49 am

I am a non interested bystander and although no one seems in the least concerned, the other point is that those not participating are being diluted.

Dod

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Re: John Laing Environmental Assets Group (JLEN)

#409987

Postby airbus330 » May 7th, 2021, 7:27 am

Dod101 wrote:I am a non interested bystander and although no one seems in the least concerned, the other point is that those not participating are being diluted.

Dod

That is exactly the point that concerns me. I'm used to and accept the dilution risk of a firm that is in its early stages of growth or is in recovery, but JLEN sells itself as a stable income producer. While the income is being produced, I don't feel that expansion should be done at the expense of the PI's capital. The renewables sector, I suppose, should be viewed as a new growth sector with attendant risks, but its not how the sector is being sold.

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Re: John Laing Environmental Assets Group (JLEN)

#412448

Postby airbus330 » May 16th, 2021, 1:23 pm

So the placing was priced at 104p. SP seems to have stabilised at just above that level. Going to be a long haul back unless the battery project turns out to have been a shrewd move.

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Re: John Laing Environmental Assets Group (JLEN)

#412462

Postby richfool » May 16th, 2021, 2:24 pm

airbus330 wrote:
Dod101 wrote:I am a non interested bystander and although no one seems in the least concerned, the other point is that those not participating are being diluted.

Dod

That is exactly the point that concerns me. I'm used to and accept the dilution risk of a firm that is in its early stages of growth or is in recovery, but JLEN sells itself as a stable income producer. While the income is being produced, I don't feel that expansion should be done at the expense of the PI's capital. The renewables sector, I suppose, should be viewed as a new growth sector with attendant risks, but its not how the sector is being sold.

It's not performing as a growth sector either! ;)

The only thing it (the renewable energy sector) seems to deliver to me, is a higher than average dividend yield, albeit at a premium.

(I sold out of JLEN and TRIG last year, but currently hold: GSF and SEIT).

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Re: John Laing Environmental Assets Group (JLEN)

#510995

Postby richfool » June 30th, 2022, 8:59 pm

An article from today's Telegraph about JLEN:
One investment that will protect you as the economy slows – and it isn't gold

Questor investment trust bargain: an unusual trust has the power to protect itself from volatile prices
By Nick Cox‑Johnson 30 June 2022 • 5:00am
renewable energy green investment

Investors find themselves at something of a crossroads. Do they keep their powder dry and stay out of the market, only to see their cash ravaged by an inflation rate at a 40-year high? Or do they risk their money in the market as we teeter on the brink of a recession?

Such is the challenge of stagflation – that toxic combination of high inflation and little or no economic growth.

In such an environment the accepted wisdom has been to invest in “real” assets, things that have intrinsic value now. One obvious example has been commodities, which have performed well so far this year but have cooled of late over predictions of slowing global growth.

One area that ticks both these boxes is Britain’s renewable energy sector, which is underpinned by government drives both to decarbonise and to secure security of energy supply – suddenly top of the agenda amid the current geopolitical turmoil.

One trust that stands out from the crowd is JLEN Environmental Assets, managed by the Foresight Group, an experienced player in this sector.

JLEN invests in infrastructure projects that either support the transition to a low-carbon economy or mitigate the effects of climate change. The trust has net assets of around £760m, boosted by two share sales totalling more than £118m in the last financial year.

Perhaps what is more pertinent though is that JLEN has the broadest remit among its 21-strong peer group: it has invested in 37 projects covering wind, solar, anaerobic digestion, waste and bioenergy, hydro and various low-carbon and efficiency projects including battery storage.

This high level of diversification helps to ensure that JLEN, unlike many rival funds, does not depend on a single market or set of climatic conditions; useful when the summer of 2021 witnessed the lowest average wind speeds for 40 years. Many of the other funds in the sector invest in either solar or wind or a combination of the two. Three focus solely on energy storage.

Furthermore, JLEN aims to invest in projects that tend to have predictable cash flows underpinned by long-term contracts under which prices are linked to inflation (and to the RPI as opposed to CPI); the trust says the portfolio currently has price fixes secured over 77pc and 74pc for the summer and winter 2022 seasons respectively.

As it stands, the trust has said it expects to pay a total dividend of 7.14p in 2023, which would represent a rise of 5pc on 2022 and equate to a yield of 6.0pc at yesterday’s closing share price of 119.6p. As well as this healthy and secure dividend, there is also the potential for capital gains from quarterly NAV revisions.


Because there is no market deep or liquid enough to readily mark JLEN’s assets to a market value, these valuations do involve some subjective forecasts, including for future power prices and inflation.

I think the article may well have been responsible for today's tick up in the share price.

https://www.telegraph.co.uk/investing/s ... isnt-gold/

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Re: John Laing Environmental Assets Group (JLEN)

#511431

Postby richfool » July 2nd, 2022, 9:45 pm

I noted the comments below the article were not complimentary.


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