Forum Archive Index - July 2002

["tennyson@caverock.net.nz" <tennyson@caverock.net.nz>]

There has been a bit of interest on the RBC/FFS equation on this 
forum before.  Namely how a price rise in Fletcher Forest shares 
affects the share price of substantial shareholder Rubicon.   

Despite a move off-shore there are still a substantial number of 
New Zealand shareholders of BIL International, formerly Brierley 
Investments about.  The perennial question is 'what is the asset 
backing of BIL'.   Because BIL holds shares in other companies this 
is changing all the time.  So I think there is some merit in figuring 
out an 'equation' to put it all into perspective.  

We can figure this 'BIL equation' from the balance sheet of the 
company, the most recent published being that in the 2001 at 30th 
June 2001, as published on 30th September of year 2001.

The headings are, as found on page 16 of the BIL International 
report, as follows:

Assets:

A1/Property Plant and Equipment

A2/Investment Property (Molokai Ranch)

A3/Investments in Associates
-3a/ Thistle Hotels
-3b/ Air New Zealand

A4/Listed Investments
-A4i/ Fraser & Neave

A5/Other Investments
-A5i/ Bass Strait Oil Royalty
-A5ii/ Unlisted Company Shares

A6/Short Term Assets

Total:  SumA1A6 

Liabilities:

L1/Due under 1 year

L2/Due 1-2 years

L3/Due 2-5 years

L4/Over 5 years

Total:  SumL1L4 


SO to get the result we want, the net tangible asset backing is: 

NTA= SumA1A6 - SumL1L4

As in the FFS/RBC case, I think it is much easier to follow this sort 
of argument if we talk on a 'per share' basis, rather than a 
'total value' basis.  We can do this as follows:

------------

For example, if you go to 'www.ses.com.sg' and find the company 
reports section, then you will find that there are 295,572,803 shares 
on issue.   If BIL holds 10% of these shares that works out as:

0.1 x 295,572,803 = 29,570,000 shares.

>From the BIL annual report, there are 1,368,000,000 BIL international 
shares on issue.  Each BIL share can be thought of as being made up 
of many building blocks, one of these blocks being the 29,570,000 
Fraser & Neave shares.  This 'block' has a value per BIL 
share of:

(29,570,000 / 1,368,000,000)(Fraser&Neave Share Price) 
= 0.02161(FRNM)/(excg$NZ$S)

where FRNM is the 'Fraser & Neave' share price as quoted on the 
Singapore Stock Exchange, and (excg$NZ$S) is the New Zealand dollar 
Singapore dollar exchange rate. 

This is the calculation for asset A4i as I see it.  Now I need to 
do a similar calculation for all of those other assets listed above



--------




Now that I've told you what I intend to do, and how I intend to do 
it, and assuming that no-one can pick a big hole in my method, the 
next stage is to do it!  Watch this space.

SNOOPY

PS One question:  BIL now owns all of the Denaru resort in Fiji.  I 
can't quite figure out where this comes in the balance sheet.  Is it 
buried in the 'Shares of Unlisted Companies' ( A5ii ) in note 15 
'Other Investments?' .  TIA












---------------------------------
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