Forum Archive Index - May 2000

[Derek Watt <dkw@paradise.net.nz>]

>Anyone have any clues as to what is going on with TTP?
>A good article in the Herald this morning about them
>buying back notes, and in effect adding $2.5m to the
>bottom line.
>Then the market slams them down to 18.5 cents.
>Does that make any sense?

I think TTP have a lot of debt and are therefore
interest rate sensitive. With interest rates going
up today, both here and in the US, investors may be
a bit nervous about TTP. This interest rate situation
seems unlikely to change quickly and is likely to get 
worse, hence more need for caution for debt-troubled
companies.

As David McEwen often points out, companies that have
high debt are less likely to survive a market downturn,
therefore even more need for caution with TTP.

Also isn't the interest rates on TTP notes fixed? 
This makes me wander if they should have put the money
to pay off interest-rate sensitive debt first.
(I'm not sure about this point - maybe someone will 
put me straight.)

Derek




-----------------------------------
Derek Watt 
http://www.blackrobin.com
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