Forum Archive Index - April 2001

["G Stolwyk" <stolwyk@wave.co.nz>]

 

Kelvin,

 

1. I located the shares as follows:

 

Prior to 21/ 3 / 01:                223 mill shares.

Buying of rest of Gr. Group   174  "       "     .     NB: 95% of the 174 mill shares are in escrow till March 31?, 2002.

 

                              June 30      2001       2002

Predicted profits ( mill ) @       7            11

Weight. number of shares          267         400

E/S cents                                2.62        2.75

P/E- price $ 1.06                      40.4        38.5

 

Notes: @: We can assume that these will be the maximum profits possible, eg. profit to 31/12/00 was 2.2 mill. See comments of April 28, 2001.

 

Although the 174 mill shares were sold to the owners for $ 1.10 / share, some investors may feel that the cost of buying the Gr. Group was too high.

 

I did not refer to the compositon of the two Boards involved. SLH was also acquiring large assets throughout the period and this may have inflated prices somewhat.

 

The Group will have a 57% stake in a Malaysia and this will be an additional risk.The dividend return will be very low!

Shares are overhanging the market. As mentioned, I feel that the current price will trend down. 

 

Kelvin, it is up to you to make a decision. I suggest, you sell and reinvest in the Auckland Airport ( AIA ).

It is possible that you may have to move quickly!

 

Regards,

 

Gerry 

Holds AIA, and so do many sharechatters!