Forum Archive Index - January 2000

[Dylan James <dylan.james@nzef.org.nz>]

Osbert; a well focussed business diretion is exactly what they are looking
at. Newcall don't own power generators or telephone lines. They are
resellers. Their business strategy is customer service, billing technologies
and sales infrastructure. I imagine they intend to dominate this service for
SMEs. Currently they sell tolls, energy, data and mobile services. I would
not be surprised to see them expand this further. A key issue for customers
is multiple bills - it is a pain. Newcall are therefore achieving a very
important advantage with the ability to combine bills and therefore save on
customer service etc.
This deal says to me that Newcall know their business. I have no doubt the
future of these type of companies is very bright - not least because it is
so amenable to new technology.
It reminds me of Ray Kroc always denying that he was in the hamburger
business - his real business was real estate. 

 

Dylan James

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-----Original Message-----
From: Osbert Sun [mailto:osbert.sun@xtra.co.nz]
Sent: Thursday, 27 January 2000 17:55
To: sharechat@sharechat.co.nz
Subject: Re: [sharechat] Newcall (NGL)


Ben, seeing the announcement today I'm glad that I'm no longer a shareholder
of NGL. What is NGL trying to do? To become a go-between agent in every
business sectors? I would have thought that a well-focused business
direction should be key to the success of a company. Well, what do I know
about running a business. NGL may well turn into a profitable business one
day. However, until I can see that happens, I'm happy to put my money
elsewhere in the market. Talking about value stocks, Revesco (RVS) has
always been one of my favorites. It's not a blue-chip stock, but it has much
to offer and a well-focued business direction in a fast growing business
sector.

Regards,
Osbert Sun

(Disclosure of interests: I hold RVS shares)

----- Original Message -----
From: "Ben Dutton" <bendutton@sharechat.co.nz>
To: <sharechat@sharechat.co.nz>
Sent: Thursday, January 27, 2000 3:47 PM
Subject: [sharechat] Newcall (NGL)


> I was surprised to see this announcement to the NZSE this morning from
> Newcall, a "telecommunications" company --
>
> "Newcall has announced that it has acquired 75% of Auckland based
embryonic
> electricity reseller, Energy Options Limited (EOL).
> The purchase price of $600,000 has been met by the issue of 1,050,000
> ordinary shares in Newcall at 57cps, with all shares subject to a
restraint
> of trade.
> The total issued capital of the company following the issue of these
shares
> will be 120,877,685 ordinary shares.
> Newcall have retained the management of EOL, both of whom were previously
> with Power NZ, to ensure industry knowledge and expertise is protected".
>
>
> These statements are taken from their press release --
>
> "EOL has customers in the small and medium size business market, and
that's
> exactly where NEWCALL is focused. We can offer additional telephony
services
> to EOL customers and our customers have the benefit of reduced electricity
> prices.
>
> "In fact we were so impressed with EOL that we changed to buying our
> electricity from them early in our discussions, resulting in significant
> savings in our energy bill," (MD Norman) Nicholls said.
>
> Nicholls said, "At one level we are able to share call centres and billing
> systems while at another we have the exciting prospect through our
recently
> acquired subsidiary, Iprolink, to provide Internet billing and other
> e-commerce marketing to a broader client base."
>
> At a strategic level the move exploits the international trend towards
> utility convergence, Nicholls said. The purchase mean we have an
opportunity
> to explore the provision of utility services at a very low cost."
> --
>
>
> Now, I have to admit that this came as a great surprise to me.  Newcall's
> purchase of an ISP, yes, that fits within my idea of a telecommunications
> company, but an electricity reseller??  Even though this purchase isn't
very
> significant to their balance sheet, it does distort my view of the
company.
>
> What do other members of the forum think about this move?  I'd be
interested
> in finding out other people's opinions...
>
> Benjamin Dutton
>
>
>
>
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