Forum Archive Index - January 2000

[frank <frank.fernandez@xtra.co.nz>]

David,
You are right about the high turnover of AQL shares last week but I
noticed that these were quickly soaked up by some large buyers too. Last
Friday especially, some 2.9m shares changed hands and of these, there
were 8 sizeable transactions which accounted for almost half of all AQL
transactions on the day.  The big buys were in 300k, 200k(3 parcels),
160k, 150k, 125k and 100k lots. Six of these parcels were bought at
0.19, one at 0.196, and one at 0.189. 
It was interesting last Friday that while AQL price dipped at one point
to 0.18, it quickly rose again (probably because of a lack of sellers
willing to go below that threshold) finishing the day at 0.194. 
AQL has always held a lot of mystique, promise, and sometimes
disillusionment for investors if comments (by some of Sharechat's
subscribers last week) about possible "dumping" are anything to go by. 
But if we are to analyse the available data in a rational perspective,
we find that in the last week, some 14.3 million AQL shares were traded
- a huge amount but then the sobering thought is that this is only about
6.5% of the 218+ million AQL shares on issue. 
When news of a possible redirection of AQL into E-commerce started
filtering out about two weeks ago, AQL's price was around the 0.17 mark,
and there was  substantial heavy trading at this price during the week
which saw AQL go up to 0.21. 
As confidence in domestic IT (or potentially IT) stocks took a tumble
last week, I suspect that many punters, who bought in the first week,
took their profits (and a handsome 12% at that) last Friday and sold up. 
Of AQL, we now know that 
· It will sell its Korean assets to Oceanis and its Shanghai assets to
the Bliss Corporation. 
· It will have an unquantified number of shares (at this stage) in Bliss
which will be relisted on the ASX.
· When the sale process is completed, AQL will virtually become a
'shell' company with lots of funds but no business to run.
· AQL has been raising money (for unspecified purposes) with private
placements of 11 million shares in the last two weeks.
· Eric Watson has a 9% stake in AQL and is understood to have an option
over the Tiong Group's 17% too.
· The other principal stakeholders in AQL are Watson's business
partners, John Sorenson and Ken Wikeley who between them own 25% of the
company.
· Watson, Sorenson and Wikeley were involved in taking Strathmore to
where it is now, and at a healthy profit too.
I do not wish to influence anyone over the future prospects of AQL as,
with no clear public articulation of its future to date, this would be a
speculative stock at this stage. But looking at the data available, and
the fact that a shareholder meeting is scheduled for 28 February, it is
more then likely that ambitious plans are in the pipeline for AQL
especially when you consider the calibre of the principal shareholders
(and their stake) in the company. 
While it has been suggested that e-commerce is a likely avenue for the
AQL shell, in particular it could be a ready-made NZSE listing for
Watson's Business Solutions (the former Blue Star Group) or even ePac,
the Watson-Advantage Group joint venture.
I hold AQL shares and intend to continue to increase my shareholding
before 28 February when I believe that an announcement regarding the
company's future direction will be made.
Hope the above is of some help, David.

Frank Fernandez

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