Saga shares

peppercat9713

I take your point on board a comment made in the heat of the moment. That will teach me to check my comments before I post lol.
Sorry for any offence given it was not intended.
But, it is a well known fact there is a North/South divide. That wasn't the
point I was trying to make though.It was the fact there seems to be this common idea that "Oldies" are rich which all of us are not.

Verkingetorix

ll the net proceeds of this sale to repay the whole of the bank debt in full, in 2019, 2020. I don't understand what is going on.

Verkingetorix

My reply was cut! See Page 10 of the Summary Prospectus with all the info about their huge borrowings to be repaid with the proceeeds of this share offer. Loans £125m for 2019, £425 m to be repaid 2020. Are they healthy because they can borrow or not doing well so they need to borrow?

bowlhead99

Verkingetorix wrote: »

... all the info about their huge borrowings to be repaid with the proceeeds of this share offer. Loans £125m for 2019, £425 m to be repaid 2020. Are they healthy because they can borrow or not doing well so they need to borrow?

They have invested millions/billions of pounds into a profitable business with assets. That money comes from shareholders and retained profits from previous years and borrowings. The borrowings are only one of those three legitimate sources of funds to run a business.

The borrowings were at one point quite large (which the previous owners didn't mind as they were one of the lenders so it was just a convenient structure to manage their risk and the tax bills). The borrowings now are from banks and similar lenders. When they get more money in from shareholders, they will pay off some more of the borrowings.

So, their finance to run their operations will still be shareholder capital, previous profits, and borrowings, but the borrowings will be lower than they are today. The borrowings that they owe the lenders will cost them a few percent interest every year (and reduce their tax bill, because it's a cost to the company). The dividends to shareholders will also cost them a few percent every year (but not reduce their tax bill).

Nearly all of their listed rivalswill have hundreds of millions of borrowings, so if they hadn't got any it would make it difficult for them to be competitive. It is like doing a buy-to-let property rental business. Most landlords would get several properties and have partial mortgages on them, rather than putting in all their own money and paying larger taxes on the profits. As someone entering that market you would be at a disadvantage if you didn't take advantage of borrowing opportunities to reduce your overall costs and run a bigger business.

However, if you don't understand how company finances work and you don't already have a portfolio of shares in individual companies, you should probably not invest in this one. Stick to investment funds which spread their money over lots of companies.

Kniffar

I have received details of the Saga Share Offer and payment must be made with the application by cheque (or debit card for online application).
This may sound a bit naive but nowhere does it say when the payment will be debited from my bank - can anyone shed any light as the process will not be completed until the end of May?
It doesn't make sense to withdraw funds from savings too early.

p00hsticks

peppercat9713 wrote: »

I have just joined the Forum because I want to make a comment on something I just read on City a.m. site stating quote;
Saga customer base is considered the perfect audience for a share sale, given their age and wealth.:mad:
" The great thing about Saga customers is that their rich and old" said one person familiar with the plans.
How totally bigoted can you be. This person obviously does not live in my neck of the woods!! Must be from down South. We in the North do not have money to burn and are not rich oldies. I certainly could not afford one of the very expensive Saga cruises or St Lucia holidays (wish I could) and just moved our car insurance elsewhere this year despite of the fact my husband and I have many years no claims bonus it was expensive compared to the insurer we are now with. So if buying shares in Saga I will have to do my homework and give it careful thought. I'am a very young 65 so need to think about the future and make sure there are funds available for my impending old age which I don't consider I have anything like reached yet. If the person who made this comment is involved at all with Saga it would totally put me off any further idea's of possibly buying shares.
I think this is a bad attitude to take about people who could be a life saver for this company!!! How about you?.

So you are old(-ish), but not that well off and therefore not a SAGA customer ? Doesn't that support what is being said ?

The simple fact is that most SAGA customers ARE old (post retirement age) and they ARE well off - the person making the quote was absolutely correct.

there was no mention of gegraphical location in the quote you are getting so incensed about, you are jsut reading things into it that aren't there to suit your own (slightly bigoted ?) agenda.

Welcome to the forum though - if the remarks have put you off investing in SAGA shares then that may turn out to be a good thing, as I personally don't believe they are going to be a great investment.

jimjames

If anyone is buying Saga shares thinking it is a no risk way to make a quick buck then you are sadly mistaken.

You may make some money on them but it is certainly not a risk-free option. The stock market could drop next week and Saga would drop with it. Individual shares are more risky and unless you have a balanced portfolio of other shares/funds and this is a small part of that then I think you would be crazy to buy. Some people were very lucky with RM and avoided their fingers being burnt but that doesn't mean it will happen all the time.

EternallyGrateful

I'm a member of the TrustnetDirect website and have just been offered Saga shares through them. Having a few bob to spare I thought I'd do some research and, of course, all roads lead to MSE!
In my view there's little likelihood of this being another Royal Mail so if you don't have much to spare or don't want to have your money tied up for years then probably best to avoid.
Most of my money is invested in income funds (under an ISA umbrella) which have this year provided an income of 4.02% of my outlay. Additionally my total investment has grown by 3.03% which includes a fund which has lost 11.5% in the last 12 months! Even that fund though has provided a 3% income.
Going back to the originator of this thread: if you've got some redundancy money and you're in you early 60's (me too) then divide your money across 7/10 income funds. You can either use Trustnet Direct or go perhaps best go through an IFA. Also you can max out your ISA allowance and get both income and growth tax free. Incidentally, you can't buy shares under an ISA wrapper.

le_loup

EternallyGrateful wrote: »

Incidentally, you can't buy shares under an ISA wrapper.

Yes you can.

josie

Kniffar wrote: »

I have received details of the Saga Share Offer and payment must be made with the application by cheque (or debit card for online application).
This may sound a bit naive but nowhere does it say when the payment will be debited from my bank - can anyone shed any light as the process will not be completed until the end of May?
It doesn't make sense to withdraw funds from savings too early.

Yes, I wondered this too. Just went online to register but can't find out when the money would be taken from my account if I were successful