Forum Archive Index - November 2001

["Andrew Smith" <smith5@free.net.nz>]

Gerry I agree with you and as no one has replied to your post and you contribute so much I have copied what I submitted to sharechat in May. As far as I am concerned nothing has changed. Its a long term hold.

 

From 15/05
Received in mail & just finished reading. A very comprehensive coverage of
the power industry of NZ. well worth the read if you are interested in where
Contact fits within it. My personal feelings are, as a long term investor,
CEN is worth holding onto. This is based on

1.CEN mix of fuel sources and geographic locations means that CEN is
strategically well placed to react to the various fuel and weather
scenarios, compared to its competitors. In particular CEN enjoys less
exposure to dry-year hydro risk than its principle competitors Meridian &
Mighty River. (Page 14)

2. CEN has a 24% share of the Wholesale market by generation but sells 60%
to its own retail customers leaving the ability to sell the other 40% to the
spot market which has resulted in record revenue levels for April. (page 16)

3. Currently 36% of the shares are held by minority share holders.(Page 25)
I expect this figure to reduce after CEN purchase the 7-8% they require and
hopefully there will be a situation similar to Trustpower, shortage of
script, resulting in higher share price. (my own ramblings based on info
page 32).

4. Good Dividend.

Regards
Andrew

----- Original Message -----

From: G Stolwyk

To: sharechat.co.nz

Sent: Monday, November 05, 2001 11:15 AM

Subject: Re: [sharechat] CEN Dogfight

Hoop,

I am not a CEN holder but as I don't see any replies to your post, I shall give you an opinion.

 

Your set of questions can really be boiled down to one:

 

"Shall I sell?"  The answer is "why"? 

 

I have followed CEN closely and it is pretty clear to everybody that CEN has put in an opportunistic bid!

 

We are at a stage where power prices are rising; unless an earthquake destroys one of their dams, CEN can be expected to deliver!

 

We already have valuations close to $6. The current price is $4.20. This is a massive discount for an important infrastructure stock!

 

Why must you sell?

 

Come on, CEN holders. what are your thoughts?

 

Gerry

Much has been made of our markets performing well against the US and other large markets. If the effect of existing attempted takeovers and those already pinpointed for future corporate action, is taken out, is it doing that well?