Sondrel Holdings (LON: SND) shares are down another 47% today as Siemens sells out of its entire holding. This is one of those things that we can take as not being a good sign. We can also note that this isn’t the first bad news this year from the company - in fact, this is probably just the second shoe hitting the floor after the first piece.
As we’ve said before about Sondrel Holdings: “So, err, why the SND share price collapse then? Because of a much later part of the same release: “it has also now been confirmed that the chip development and production for three major ASIC customers due to commence in H2 2023 have been delayed by between six and twelve months as a result of increasing inflation and weakening demand in end markets reliant on consumer spending as other sector categories have moved into negative growth.” Resulting in the first half being good, as above, the full year will be bad: “FY23 full-year revenue will be not less than £13m, substantially below current market expectations, with a corresponding impact on FY23 losses.” Actually, the second half’s going to be a stinker.”
Sondrel Holdings share price from Google Finance.
That was at the time of that more than halving of the share price at the beginning of September. The thing is, things haven’t got better. As today’s announcement says: “Siemens Industry Software Limited ("Siemens") has sold, subject to completion, 9,813,450 ordinary shares of £0.001 each in the Company (the "Placing Shares") at a price of 6 pence per share (the "Placing"). Peel Hunt LLP ("Peel Hunt") is acting as sole bookrunner to the Placing. The Placing Shares represent approximately 11.22% of the Company's issued share capital. Following the Placing, Siemens will not have an interest in ordinary shares of the Company. The proceeds of the Placing are payable in cash and will be settled on a T+2 basis (unless otherwise agreed), and settlement of the Placing is expected to occur on or about 5 December 2023. The Company will not receive any proceeds from the Placing.”
It’s true that there are bits of Siemens that need cash at present but perhaps not this much. It’s also true that we’d expect Siemens to have a view on the chip market. And if they’re selling out of Sondrel then isn’t that a guide for the rest of us?
