Forum Archive Index - January 2001

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

Surprised that (a) TCM's shareprice hasn't collapsed in a heap
(b) there's absolutely no debate in sharechat on what's happening,
about to happen, might happen to the NZSE's biggest company.
Here we have TCM still digesting with difficulty its meal of AAPT
saying it will go it alone at buying a huge chunk of C & W Optus
which as observers are pointing out implies a huge cash issue
which will dwarf FFS or Air NZ plus having to flog off all or large
parts of the Pacific cable network plus Xtra plus whatever else
it can think of. Even if it just buys Vodafones Oz ops its still
needs to find large amounts of cash.
So what happens to its shareprice?
Nothing.
Given what happened to Air NZ and FFS share prices with their 
cash issues one would have expected a few switched on punters 
to exit now before the rush or do they expect brilliant floats for
Pacific and Xtra with a big concessional element for existing
shareholders or do they think TCM has collapsed far enough
already or are they just numb from the pasting already received?
Sorry but I'm struggling to understand what's happening or 
rather not happening in the minds of TCM investors.....
The same observers are now pointing out that TCM's obstinate
refusal to do partial floats of worthwhile specialties earlier have
now cost it dear in terms of not having cash available to seize
its opportunities and that it won't be able to float fast enough
to meet its cash requirements - maybe some international
financial syndicate will lend it a few billion $s short term while
it finally gets its floating act together at a much lower price.
I wouldn't invest in them myself given the commoditisation of
telecommunication products worldwide but its still a fascinating
exercise watching the dying convulsions of an ex SOE dinosaur.
As said previously I'd be amazed to see TCM still listed on the 
NZSE at the end of this year in its present form without breaking
up into several floated subsidiaries. Maybe I'll be amazed.
Incidentally, can anyone recall the last time a large acquisition
actually benefitted the shareholders of the aggressor?
There's a challenge for you - its easy to reel off a really big list
of those that haven't.
Even a profitable buy doesn't seem to be successful....how much
have Carter Holt shareholders benefitted from the huge profit on
its Chilean investment? Any advance on nothing?
Possibly Monatana's takeover of Corbans might be an example
but its the only recent one I can think of. And at least its wines
are differentiated from other wines whereas toll calls, cellphones
and Internet access are undifferentiated...

cheers,
Hugh


----------------------------------------------------------------------------
http://www.sharechat.co.nz/          New Zealand's home for market investors
http://www.netbroker.co.nz/        Trade on Credit, Low Brokerage. Join now.
----------------------------------------------------------------------------
To remove yourself from this list, please use the form at
http://www.sharechat.co.nz/forum.shtml.