Forum Archive Index - January 2000

["hugh webber" <hugh.webber@clear.net.nz>]

Interesting point re where Nuf's main shareholding now is. My recollection
from about 8 months ago is that K Hoggard had a surprisingly large chunk of
the shares in one way or another (about 30%?) and of course he and the
whole caboodle of management have now resettled in Australia so that all
their shares will have been transferred to ASX. And then there are all the
institutional holders who operate on both sides of the Tasman like AMP and
naturally they would transfer their shares to Australia for tax reasons if
nothing else. And I guess a lot of the NZ investors who sold out for tax
reasons and the purely NZ Institutions who sold out for Index reasons (no
longer part of NZSE40 etc) a lot of that would go to Australian
Institutions (all this NZ selling out for tax and index reasons has
obviously had a big temporary effect on the price). We could probably get a
proxy measure by checking the size of Oz turnover in Nuf against the size
of NZSE turnover in Nuf although I suppose there is quite a lag in the
transfer of scrip from NZ to Oz. 
I would have to say that the management probably no longer care how Nuf's
figures look when translated into NZ dollars in future with the NZ market
share 10% and falling rapidly and the proportion of shares domiciled in NZ
under half and falling rapidly.

Commodities by definition are usually in over supply (low or no barriers to
entry, many competitors, competition purely on price etc). Oil is about the
only one with an effective cartel and it may yet fall to pieces as it has
before. The last concerted international boom in commodities was 1972/73
and there doesn't look like another one this year in the sense of causing
serious international inflation in itself. Hence, with the other factors
I've mentioned previously I don't really see Nuf being embarassed by rising
interest rates. The amazingly technological progress in computerisation,
telecommunications and automation generally (anyone see the robotic brick
stacker which replaced 8 people, has a low capital cost and only needs
maintenance every two years on Telstra Business program this morning?) has
enabled fast productivity growth with low inflation and Alan Greenspan has
picked that. (its also put the lid on labour cost inflation). So, its hard
to see Nuf being seriously embarassed by rising interest costs and while
its a shame to see it go I'd pick that when the sellout of Kiwis for tax
and index reasons has finished it will show a strong rise in price as it
starts to go into Oz indexes and pay franked Australian dividends. A solid
share, no froth and no bubble.


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