Second bite at Auckland Airport by CPPIB could just fly

Well, I got the offer for my Auckland International Airport Ltd [AIA.NZX] shares from the Canucks', Canada Pension Plan Investment Board, in my mailbox yesterday.

This is the second bid from the Canadians.

Its pretty basic, you can either accept the offer partially or fully for your shares and vote accordingly for CPPIB to take just shy of a 40% stake in AIA and for a NZ$3.6555c cash consideration.

Seems allot lower value than some have put on the company but it is a reasonable advance on the current share price of $2.80.

Brook Asset Management and other broker institutions look likely to back the offer but the two large council owned parcels of shares and those of Lloyd Morrison's Infratil, which make up around a 30% shareholding are likely to sit on the other side of the fence.

There are also regulatory issues in the way in regard to Overseas Investment Office and IRD approval of tax related matters germain to the deal and political pressure from the usual numbskull's like Winston "Baubles" Peters.

This bid however is more likely to succeed than the bid from Dubai Aerospace International, which was shot down by the AIA board even before it could be put to shareholders earlier in the year because there isn't the Middle East/Muslim factor involved and the DAE bid involved more control with a bigger stake.

Obvious problems with a Muslim company owning AIA made a big influence on my decision then to back shareholders holding onto their shares although I wasn't opposed to another foreign owner making a bid.

Having seen the CPPIB offer it looks good compared to the alternative if one was to stay a shareholder.

CPPIB has changed the terms of its planned amalgamation with AIA (assuming it gets to approx 40 per cent). Stapled securities issued under the proposed amalgamation will now include a convertible note with a face value of $2.75 (previously $3.35) an ordinary share with a face value of $.0.7055 (previously $0.1055) and $0.20 cash (unchanged). The convertible notes will pay a 7 % coupon rate.

So there is more debt servicing for the new AIA model under the Canadian proposal and this is clearly going to drag on profit in the short to medium term until the various benefits they have mentioned under the new structure are bedded down and then realised.

The Canuck investment board sure are canny investors with a good track record,

		$121.3 Billion At September 30, 2007 Financial Highlights Annual Report 2007

But it remains to be seen, if they are successful whether they can make their investment in AIA fly or if it is going to crash land.

There is going to be a AIA Board announcement and appraisal tomorrow(NZ Time) by Grant Samuel's, with valuation assessment and projections on passenger and aircraft demand.

Full CPPIB Offer


Queenstown Airport Buyout @ Share Investor

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AIA @ Share Investor

Make me an offer I cant refuse: Auckland International Airport Ltd
Long Term View: Auckland International Airport
VIDEO - Simon Moutter on Australian Airport Purchase
Auckland Airport Capital Raising a fair call
Auckland International Airport lands Australian Ports
What Infratil sale of Auckland Airport stake means...
Is another Auckland Airport bid likely under a business friendly Government?
Latest Airport coverage
Cullen's move on Auckland Airport has far reaching effects
Cullen's move on AIA tax plan Anti-Business
AIA profit stays grounded
Softening opposition to CPPIB bid for AIA
Directors of AIA bribe brokers not to sell
What is Auckland Airport worth to you?
Second bite at AIA by CPPIB might just fly
AIA new directors must focus on shareholders
Auckland Airport merger deal nosedives
The Canadians have landed
AIA incentive scheme must fly out the window
Government market manipulation over AIA/DAE deal
DAE move on AIA: Will it fly?

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From Fishpond.co.nz



A Perfect Gentleman: The Sir Wilson Whineray Story



c Share Investor 2007

Money Manager's first step gives investors the middle finger

Today's column time warps back to 2002 when I started a thread on the financial forum Sharetrader. The thread was titled "Are Money Managers Dodgy? I cant find it on the site now as I suspect the owner of Sharetrader, Tarawera Publishing, has removed it due to the slagging off of Doug Somers-Edgar, the owner of MM, through a family trust.

The finance biz is very small in New Zealand and people don't like to step on toes, even though they should, should they want to continue to do business with each other.

Flick back to today and we find the on-going saga of Money Managers and their "First Step" product seems to have finally come to a soggy mess after being closed down in 2006.

Money Managers have told over 7000 investors they are unlikely to get all of their money back after First Step was liquidated, putting around $150 million of total funds invested at risk of being flushed away.


The NBR had this to say about First Step back in February 2002:

First Step's own financial statements showing related party lending at 29.58%.
There is still no information on where the money finally ends up, what the rate of return is for those related parties, and the level of risk to which First Step investors are exposed.

Among the questions Mr Somers-Edgar has refused to answer:

Could that expertise not be provided within First Step, thereby providing more transparent accounting for funds?

Are the returns in line with the level of risk investors are taking?

Why will Money Managers not open up to independent scrutiny?

What is the total "cost on funds" (how much money the investment is generating compared with how much investors are getting back)?

What are the total fees charged?

The National Business Review has revealed how the First Step structure puts walls between investors and their money, with no clear account of what happens behind the walls.

First Step has had a chequered disclosure history; the Securities Commission suspended its prospectus when it was first issued in February last year.

Presumably Money Managers didn't inform clients of the concerns of the likes of the NBR and myself and continued to take in client's funds in a dishonest, calculated and deceptive way.

This part of the NBR article is revealing:

First Step's own financial statements showing related party lending at 29.58%.

One would have to ask, if there is interrelated lending from First Step, as there is with every other "product" Money Managers peddle-Doug is known as "Mr Clip, Clip" for every time there is an inter-company loan or transfer he clips the ticket with a fee-why don't the more profitable areas of the business lend money back to First Step to bail out Money Managers 7000 clients?

I know it is a dumb question but it had to be said.

I urge anyone considering investing in any of Doug Somers-Edgar's companies to take a deep breath, Google his name and see what you come up with and then make your decision.

What has Somers-Edgar been up to lately?

Doug has mysteriously disappeared from his former high profile, since stepping down from Money Managers in 2006 but seems to have been busy suing people for critiquing his investment style.

From 27 June 2004, Somers-Edgar-related CTT companies in receivership (CTT Finance Holdings, CTT Financial Services, CTT One, Dental Finance, Paragon Factors and involved in numerous other liquidations of his own, related and other parties companies

Owning a dodgy Ginseng business.

Related Share Investor Reading

The "New" Money Manager's Investment Vehicle still tainted by its past
Don't forget Money Managers
Orange Finance collapse should turn investors red, with rage
Money Managers First Step saga: 3 Story wrap

c Share Investor 2007 & 2009

Waiting for the backlash

Emmerson, NZ Herald, Dec 12 2007- "Shallow and error-prone"

The Herald is facing a backlash from Helen Clark for their strong
stand against the Electoral Finance Bill, she doesn't like opposition
and the EFB removes that in election year.



The latest stupidity from the Labour/Peter's Government, Winston"Baubles" Peters, paying back ill gotten taxpayer money to a children's hospital instead of the Auditor General, is merely another in a long list of arrogant, unlawful, stupid, malicious and corrupt practices that Helen and her hangers on have foisted upon us over the last 8 long years.

I'm just wondering to myself, when is there going to be a backlash?

Where is the anger, the outrage, the venom, has Clark's regime breed the mongrel out of us?

There have been touches of it, with street protests against the Electoral Finance Bill, but those were tame. In Australia cars would be burned in the streets if their leaders tried this sort of fascist stuff!

We watched our judicial system tumble when Labour pulled down the august pillars of the Privy council appeals without a whimper.

Little was done when Kiwis' rights as parents to discipline their children by having the capacity to smack was removed.

Attempts at dissolving property rights, the intervention of Clark's nanny statists to tell us what to eat, watch, listen to, breathe and teach us "appropriate" ways to talk to those who offend against our persons least we hurt their feelings were met with a whimper of dissent, even from the National "opposition".

The arrogance of a leader and those under her who believe they are above those that they work for is truly mind blowing. Speeding through a small town at 170km per hr to go to a rugby game and blaming several policemen by allowing them to be charged. Mugabee and other tin pot dictators would be proud and we presumably were too because few bothered to raise a voice let alone a middle finger.

Making theft of taxpayer money to buy an election legal after the fact is clearly a breach of the very moral and indeed legal fibre that most Kiwis presumably live by and I would have thought that even the loony left who voted for Labour, NZ First, The Greens, The Maori Party, United Future and Jim Anderton, would have stood up to be counted, considering they are implicit in the crime of buying votes with stolen taxpayer money.

Surely the guilt must be eating away at their conscience?

The gutter snipe attacks in Parliament by sniveling little Stalin adherents, like Micheal Cullen and Trevor "The Bash" Mallard against the leader of the opposition, John Key, for dragging himself out of poverty and making a success of himself in the finance world and accumulating wealth is truly without parallel.

"Scumbag, scumbag, scumbag" "rich prick" sums up Cullen's attitude to those that might have worked hard and made money, his use of terms like this, especially in Parliament, show him for what he and his party are.

Arrogant, self serving, jealous of those that have done better and career politicians who wouldn't have a way of making a living outside government, a government department or a union and supporters seem to lap up this sort of childish playground stuff because they probably feel the same.

We shouldn't be hacked off and angry like Dr Cullen because an individual might have made a success of his life through hard work and accumulated wealth we should be angry at those who deride those successful people!

Is it not the Kiwi way to get pissed off when your freedoms are being chipped away or is it up to the likes of people like me to motivate you off your couch and get yelling "we are as mad as fuck and we are not going to take it anymore!!"

We have seen any possible anger subside come the last two elections because Labour have bought voters by promising taxpayer moola for their back pockets and any opposition is conveniently forgotten.

I will be here to remind you in 2008 to stay angry, if you are, and use that anger in a positive way by choosing not to vote for those that want your freedoms quashed, and not let you be tempted by my taxpayer dollars to dissipate that anger and vote for your wallet.

C Political Animal 2007

Can the Joneses keep up with the market?

The Joneses will have to work hard to satisfy stockmarket
investors that theirs is a company worth investing in to
make the IPO a success.


A dearth of IPOs in New Zealand so far this year and what we have had has mostly been unmitigated garbage.

News released yesterday that The Joneses , the cut price real estate agent, is going to list on New Zealand Exchange's alternative market, in mid-February 2008 piqued my interest somewhat.

Now I guess your initial reaction might be hell, I don't trust real estate agents, and you could be forgiven for thinking that but I can see some promise in the idea that the owners of the Joneses', TJRE Holdings and director Chris Taylor have.

Kiwis have no listed exposure to the residential property market and we just love to invest in residential property, at the expense of the sharemarket mind, but what an opportunity to combine the two aspects.

The company is very small and has been operating since last year, with offices in Dunedin, Christchurch, Auckland and Wellington, so the possibility for good growth is there.

Revenues from house sales commissions are estimated at NZ$1.2 billion, with Barfoot and Thompson in Auckland taking up the bulk of that. The revenue is certainly there so it is a case of the Joneses upping their ante to keep up with the Barfoots and LJ Hookers of this world.

In the absence of more details of how the company is structured and how revenue is made, presumably through a cut of the sales commission, one cannot make a serious decision to plunk any shekels down yet.

Time to look at the industry and see how this model might work/fail if you want to invest.

Bring on the prospectus.


Related Share Investor reading

IPO quality indicative of poor economy
The Joneses Real Estate business fails to keep up with market conditions


C Share Investor 2007