Forum Archive Index - March 2000

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

as a long time holder of BRY who baled out between $1.20 and $1.30
for most of my holding I have severe reservations about BRY. In some
ways its disposed of the most salable of its assets already and it has
some huge albatrosses left. Take Molokai Ranch (Hawaii) for example which I
think is still in the books at over half a billion and makes a profit of
about $1 million a year. It was bought in the belief that it could be cut
up for profitable real estate development but I believe that's been ruled
out by local and environmental opposition. Then there's the Vox chain
in Australia bleeding red ink which every report used to tell us was 
about to be fixed. Thistle in the UK was bought on the basis of the 
underlying real estate book values rather than the profit stream. The
underlying book values vanished in the real estate crash in the UK
which saw people with houses worth rather less than the mortgage.
And then there's Air NZ which someone in this column wasn't too impressed
with recently; can Selwyn really justify the $3.40 paid out in the
lightning
raid? (I sold out it seemed too good to be true). Air NZ still has to find
a way
to effectively challenge QANTAS and is at the mercy of any new cut price
operator coming in big or small. 
Overall the return on assets is abysmal and there is no easy quick way for
such a lumbering giant to be quickly turned around.
Even if it changes its name to Bil.com via Camerlin/Rothschilds in
Asia, how do you change a multi-billion old economy conglomerate into a
skittish cutting edge of technology will o the wisp IT kitten? Any IT
purchase
would be totally outweighed by the huge overhangs from the past and even if
it made a profit, unlikely for a new tech, it would be a tiny % of the
total assets
or even shareholders funds employed.
I can see Frank's logic on AIA but I'm afraid I'm just flabbergasted on the
BRY rumour.
What next, Christine Rankin for businesswoman of the year.....



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