TRANSRAIL / TOLL NZ

[sarpar]

Can anyone throw some light on why TRH shareprice is where it is now?I still hold a small parcel of TRH as a long term investment. Any comments would be appreciated.

[Halebop]

Hi Sarpar. I guess that depends on what "where it is now" means? Is that high or low?

[Paper Tiger]

That is a profoundly deep and meaningful question sarpar. The answer is "because".

Perception is Reality.

Have a nice day
Paper Tiger

[good news]

-Quality managment
-Assets were sold cheap in the first place
-Movement of freight from road back to rail and increased rail traffic to and from POT.. Blue sky potential
good story , still holding on from 1.15

[troyvdh]

Yes I am bragging......bought mine at 43 cents....gee and those jokers told us that 1.10 was fair and reasonable....I agree this little baby is blue sky stuff.

[sarpar]

Any ideas on when Toll NZ might attempt to pick up the balance of the shares outstanding? As the American investment group hold more then 10% of the shares, does it mean that should Toll NZ buy the Americans out, it would have to offer the rest of us the same price per share?

Toll just might sell and realise their profit

[Mick100]

quote:Originally posted by sarpar

Any ideas on when Toll NZ might attempt to pick up the balance of the shares outstanding? As the American investment group hold more then 10% of the shares, does it mean that should Toll NZ buy the Americans out, it would have to offer the rest of us the same price per share?



Are you sure third avenue have 10% sarper?

Just checked the SSH's and looks to me like they have around 8%

In saying that i think your assumption with regards to toll trying to mop up the remaining shares is correct. They will make third avenue an offer to get over the 90% threshhold so they can compulsorily aquire the remaining shares from minority holders.
By law they have to offer us the same amount of money which they paid third avenue - if this senario eventuates.

It will happen one day but don't ask me when

TRH is definately a hold

It's quite likely minority shareholders could very well out of TRH eventually.

Still holding a few


Mick

[sarpar]

quote:Originally posted by Mick100


quote:Originally posted by sarpar

Any ideas on when Toll NZ might attempt to pick up the balance of the shares outstanding? As the American investment group hold more then 10% of the shares, does it mean that should Toll NZ buy the Americans out, it would have to offer the rest of us the same price per share?



Are you sure third avenue have 10% sarper?

Just checked the SSH's and looks to me like they have around 8%

In saying that i think your assumption with regards to toll trying to mop up the remaining shares is correct. They will make third avenue an offer to get over the 90% threshhold so they can compulsorily aquire the remaining shares from minority holders.
By law they have to offer us the same amount of money which they paid third avenue - if this senario eventuates.

It will happen one day but don't ask me when

TRH is definately a hold

It's quite likely minority shareholders could very well out of TRH eventually.

Still holding a few


Mick


I thought Third Ave did have 10%..but maybe not. I checked in the Toll 2004 Annual Report and they holding only 8.37%!

[Mick100]

Third avenue just made another ann

They now have 9.37% stake in TRH


Mick

[Westie]

quote:It will happen one day but don't ask me when

TRH is definately a hold

It's quite likely minority shareholders could very well out of TRH eventually.

IMHO Third Ave are a pretty damn savvy outfit (and by the same token so are Toll), so i'd hold so long as they are around. Although Toll are tough customers, the pressure is on them as Third Ave are at least as hard nosed and they'll be happy to stay long term until full value is extracted.

[sarpar]

My stockbroker keeps trying to convince me to sell my small holding and to invest the proceeds in another stock! His explaination is the Toll already have control of Transrail and will be in no rush to do a complete takeover..and that waiting for the complete takeover means forgoing what you could do with the proceeds now. Any comments folks?



quote:Originally posted by Westie


quote:It will happen one day but don't ask me when

TRH is definately a hold

It's quite likely minority shareholders could very well out of TRH eventually.

IMHO Third Ave are a pretty damn savvy outfit (and by the same token so are Toll), so i'd hold so long as they are around. Although Toll are tough customers, the pressure is on them as Third Ave are at least as hard nosed and they'll be happy to stay long term until full value is extracted.

Sarpar what happens if Toll puts 20 or 30% on market slowly and withdraws their finance. Toll Makes a very nice proffit and TRH has to pay more for finance.

[Paper Tiger]

Oh look! A blocking stake [}:)]


quote:
TRH
12/05/2005
SSH

REL: 0853 HRS Toll NZ Limited

SSH: TRH: SSH Notice Received

NOTICE 25107 DETAILS

Submitted Date : 12-May-2005 08:51
Status : Accepted

Substantial : Y Director : N
Add Holder : N Change Holder : Y
Ceased Holder : N Change Nature : N

Issuer Code : TRH Toll NZ Limited
Holder : Third Avenue Management LLC

Address : 622 Third Avenue, 32nd Floor
: New York NY 10017
Country : United States

Contact Name : W James Hall
Phone : 212 906 1190

Total of Interest : 21041613
Total Issued : 210239000
Total % : 10.01

Class : TRH
Votes Attached : 1

Beneficial
Total of Interest : 21041613
Current % held : 10.01
Last % held : 9.37
Names :
Transaction Dates :
Total Votes : 21041613
Considerations : 34230275

Non Beneficial
Total of Interest :

Description :

Investment Purposes
Documentation
With Notice : No
Not Filed : No
Been Filed : No
Number of pages : 2

Date of Last Notice : 23-Mar-2005

Submitted By : W James Hall on 12-May-2005 at 08:51
End CA:00115205 For:TRH Type:SSH Time:2005-05-12:08:53:08

[David Renwick]

Might be time to get on board the TOL choo-choo.[?]

[ari]

quote:Might be time to get on board the TOL choo-choo
Why the wait? My buy point was .43c:D

[rmbbrave]

Stop beating around the bush gentlemen!

If you smell a takeover please put up a scenario.

Other contributors can then point out the unlikely parts of it and improve upon it.

[Paper Tiger]

OK. 3rd Avenue will sell their stake in Toll to Mainfreight who will then turn up at annual general meetings and tell Toll that they are doing a really bad job but if Toll give Mainfreight their holding in Owens they will not laugh to loud.

[TerryA]

Not many bidders for TRH today and the SP moving sideways.

OWN down 15c so far and also not much by way of bidders.

MFT down, when I last looked, continuing a recent trend.

POT down 25 today,

Could the result of the Battle of the Ports have been leaked ?

[Nimble]

Now that Third Avenue have reached 10%, enough to single handed prevent TOLL moving to 100%. They may decide to stop buying shares on market. Will be interesting to see if price holds up. Between Toll & Third Avenue only 6% of company share left. Will tighten my stop.

Third Avenue takes bigger slice of Toll
13 May 2005

By PAM GRAHAM
United States fund Third Avenue Management has increased its stake in Toll NZ and is disputing a claim by majority shareholder Toll Holdings that it is looking for a quick windfall profit.
Third Avenue filed a substantial shareholder notice yesterday, revealing a 10.01 per cent stake in Toll NZ, the renamed Tranz Rail, up from 9.37 per cent. Australian company Toll Holdings is stuck on 84.2 per cent and grumpy about the situation.
"We have quite a hostile shareholder based in the US who believes he can make a quick windfall out of what we are trying to do in New Zealand," Toll chief executive Paul Little said last week. "We think that is most unreasonable and we won't be held to ransom."
"This was an ill-conceived comment," Amit Wadhwaney, Third Avenue's portfolio manager, said yesterday. Third Avenue was a long-term investor and it had cordial relations with companies it invested in. It was not holding Toll to ransom. "Hardly. We think of ourselves as partners of his and we hope he thinks of himself as our partner too. We are supportive shareholders."
In fact, Mr Little's problem seems to be that Third Avenue likes him. "I think he (Mr Little) is a breath of fresh of air." Mr Wadhwaney said. "Tranz Rail's operating record was not exemplary in the past. The involvement of Toll has really improved the company's performance. As shareholders we applaud that."
Toll NZ's share price was quoted at $3.06 yesterday, nearly triple the $1.10 Toll paid in its 2003 bid. That makes any eventual buyout of minority shareholders expensive.
Third Avenue is not disclosing its average entry price but said it was well below the current share price. Third Avenue believed there was a "considerable opportunity" for Toll to rebuild Tranz Rail and it was the most exciting part of Toll's business.
Growth opportunities would never have been seized under the old management. "Potentially it (Tranz Rail) could be an incredibly well-run company. You're only seeing the beginnings of the change and the transformation that is taking place," Mr Wadhwaney said.
Third Avenue did not buy and sell shares "like trading stamps", he said. It tended to buy and hold shares. Its international value fund had had zero turnover in its first year.
"We sold no shares." That rose to 4 per cent in the second year and 11 per cent in the third year. Mr Wadhwaney has not met Mr Little but he expects to one day

[ari]

Another cunning Cullen plan...lets stuff rail.....or are the Aussies getting cold feet?

Toll gives Cost Warning

Frustrated rail operator Toll says a lack of progress in its negotiations with the Government is delaying big spending decisions and could slow the shift of freight from road to rail.

Melbourne-based Toll managing director Paul Little said talks with Crown track management agency Ontrack were bogged down on track access charges, with the rail industry being asked to pay "overnight" for a 15 to 20-year track maintenance "deficit".

"Not only is the Government putting in danger here the speed with which goods may be transferred from road to rail, it also needs to recognise that Toll needs a stable environment to spend the tens of millions of dollars it needs to spend in New Zealand. At the moment we are not seeing that and that is an area of concern."

In a deal in June last year, the Government reclaimed the national track network from private ownership for $1 and agreed to spend $200 million improving it. Toll committed to spending $100 million on trains. The spending by both would be over five years.

Little said Toll would have to spend "a lot" more than $100 million, but investment decisions were on hold while it had "no security around the bottom line".

The fee for access to the network for the first year was set at the time of the deal. The negotiations under way now are for future fees.

Toll and Ontrack will meet again today.

An Ontrack spokesman said it intended to follow the processes set down in the New Zealand Rail Access Agreement.

Little said any attempt to "push higher than acceptable" charges on to Toll would flow through the industry very quickly.

"It is a pass-through cost, so if the access charges get doubled, hypothetically, that component, and our charge through to our major customers, gets doubled.

"The Government needs to be mindful it may well slow up the transition of freight from road to rail if rail becomes less competitive in terms of its cost base. It becomes more difficult for groups like Toll and Mainfreight and others that are major rail users to persuade customers to use rail.

"The Government's whole philosophy, I think, is to attract freight from road to rail. There is not a big cost difference today between road and rail - it is a very finely tuned equation. If we get lumped with very high access charges ... it will impact on how efficient we can be in enticing customers."

Ontrack said its international tender for an infrastructure maintenance contract would be finalised around November.

Rail operators

Ontrack

Established in September 2004 as an SOE
Manages track access, the track upgrade, land and leases associated with the rail corridor
Toll has one seat on the board

[sarpar]

By NZPA
Thursday 23rd June 2005

Rail operator Toll Holdings may go back to the negotiation table with the Government in a bid to level the playing field between road and rail.

The company is concerned a bill to secure the long-term structure of the New Zealand Railways Corporation (NZRC) does not support key principles of its partnership with the Government and could hamper efforts to switch more freight from the road on to rail.

"The lack of focus on the creation of a sustainable transport network in the legislation could create an environment in which rail would struggle to compete with existing road infrastructure," Toll spokesman Greg Steele said today.

"Investment in road infrastructure would create an uneven playing field for rail, particularly in the further flung regions from the main network."

The Railway Network bill will provide the framework for the state-owned NZRC's operation of the national rail network following the Government's purchase of the tracks from Tranz Rail for $1.

Toll has taken issue with aspects of the bill, including an NZRC objective to "aim to recover its direct and indirect costs of operating the rail network".

Toll says this is inconsistent with its own Government deal, in which a key principle is to build a sustainable transport network that puts the public good above profits.

The company is troubled by the bill and says it is "not above reviewing aspects of the Government-Toll deal".

"It is a commercial agreement and any commercial agreement will have its bumps in the road and may need to be revisited," Steele said.

Bumps in the road, or rather kinks in the track, include the decrepit state of the network and the gap between road and rail user costs.

Last year the Government and Toll agreed to plough $200 million into upgrading the track, but have since admitted the amount is terribly inadequate. A recent study commissioned by the Transport Ministry showed rail freight users paid 82% of costs, compared to 56% for trucking operators.

Toll says it is committed to developing the rail network in New Zealand and is looking for a similar stance from the Government.

"Rail currently has cost and efficiency advantages over road that make it an important alternative from a public good perspective," Toll said in its submission on the bill.

"Reduction in congestion, diesel usage efficiencies, and rail's significant safety and environmental pollution advantages are examples of this.

"These advantages are not appropriately valued or supported within the bill."

The Government today announced a one-off $500 million cash injection for improving road transport . A spokeswoman for Finance Minister Michael Cullen said it wasn't a question of putting road before rail.

"This funding will be going to Transit because there has been an acknowledged need also for more funding for roads," she said.

"The Government acknowledges that $200 million will not be enough (to repair the rail network) and is considering applications for funding on a case-by-case basis.

"Toll is already in talks with the Government."

Steele said Toll also wants a more hands-on role in deciding where any future rail funding goes.

"What we want is an understanding that the Government will come to us before deciding whether to build a four-lane highway or a shingle road."

[sarpar]

Does anyone know who is buying the small parcels of shares lately? Could it be TOLL NZ mopping up? Any thoughts anyone?
Cheers

[Paper Tiger]

I understand that the Overlander Auckland - Wellington (and vice versa) passenger rail service does not pay it way and will be no more after September.

Weather permitting it provides great armchair views of a range of some of the North Islands great scenery, and I, for one, never tire of that.

Pity it has to go. :(

regards
Paper Tiger

Disc: I am booking myself a trip or two.

[Mick100]

I understand third avenue have a 10% stake so ultimately toll have to get third avenues shares to complete the takeover. Once they get over 90% they can force the remaining minority shareholders to sell to them. So they have to get third avenues shares. They could possibly be mopping up some shares so that there are less shares to be bought at a substancially higher price when they finnally take on third ave

I'm quite happily hanging on to my small holding until toll complete the takeover.
.

[limegreen]

quote:Originally posted by Paper Tiger

I understand that the Overlander Auckland - Wellington (and vice versa) passenger rail service does not pay it way and will be no more after September.

Weather permitting it provides great armchair views of a range of some of the North Islands great scenery, and I, for one, never tire of that.

Pity it has to go. :(

regards
Paper Tiger

Disc: I am booking myself a trip or two.



Not being North Island based, I won't be booking myself a trip, but I too agree that it is a great pity. However, the last time I considered it, I was surprised at how much more expensive it was than taking a bus. I always found this confusing. Maybe there is something I don't understand about trains, but it seems that it would doubling the number of carriages would not materially affect staffing or the amount of juice required to get underway (the loco weighs as much as half a dozen carriages). Thus, it seems like a low-cost model should be able to take the stuffing out of the bus service. Or at least put it on even footing. Also, having just returned from another trip to Europe, I wonder whether moving to a dual-class system might help. I wouldn't want a super-ratty 2nd class, but something comfortable and cheap would be good.

I used to take around 10 trips on the Southerner each year, and it was imminently preferable to taking the bus. And you can buy drinks on the train. (Or, top off a 2L of coke with bourbon...). Thinking of which, I had a really rather pleasant bordeaux on the TGV...[8D][8D]

[Crusader]

As Toll NZ operate on a largely single track line, extending the number of carriages in the consist is extremely difficult. A network planner has to consier passing loops and their holding capacity to allow mainline freight trains to pass or sit whilst the passenger train passes.

Adding another loco - possibility. No problems in 2 locos hauling that much weight, just a matter of is another loco available?

Rolling stocks and locos have always been a supply issue for TR and Toll.

Crusader

[J R Ewing]

PT I agree it is a shame to see the overlander discontinued. I took a train trip from Montpelier to Paris 10 days ago, a journey of just over 700 km so slightly longer than Wellington to Auckland. The trip took a shade over three hours. NZ just doesn't have the infrastructure normally associated with a 21st century western economy. The comparison of roading networks for instance gives a similar picture.

[limegreen]

quote:Originally posted by Crusader

As Toll NZ operate on a largely single track line, extending the number of carriages in the consist is extremely difficult. A network planner has to consier passing loops and their holding capacity to allow mainline freight trains to pass or sit whilst the passenger train passes.

Adding another loco - possibility. No problems in 2 locos hauling that much weight, just a matter of is another loco available?

Rolling stocks and locos have always been a supply issue for TR and Toll.

Crusader


The Southerner used to run with 3 carriages. If freight trains can pass each other with many more wagons, I think there is room to expand the passenger trains well beyond their current length (although I confess I don't know how many carriages The Northerner would typically have). Rolling stock is certainly an issue. To me, at least, commissioning a dozen brand new first class carriages and using the current stock as a second class would seem like an option...

[winner69]

Heard three ads on the radio this morning raving how wonderful the Overlander is .... cheap way to get to Auckland etc ..... book now for your summer holidays etc etc

Obviously the marketing dept hasn't been told yet

[Gryffyn]

Freight the next to go on the main trunk line?

Sunday July 30, 2006
By Pam Graham

The body blow the main trunk line took with the axing of Auckland-Wellington passenger services last week could soon be followed up with a knock-out punch of freight services, industry sources have said.

Rail operator Toll New Zealand's board meets tomorrow amid speculation in the transport industry that more closures of rail services are in the offing - including the backbone main trunk link.

The Australian-owned company last week announced the closure of the Overlander passenger service between Wellington and Auckland from the end of September.

The passenger service was losing money and the Government decided not to subsidise it.

Industry observers said some freight services are also uneconomic and that even the future of freight on the main trunk line used by the Overlander is not secure.

"The reality for New Zealand is that there is a nightmare scenario in which Toll just puts railfreight on trucks," said Brian Cronin of the Rail and Maritime Transport Union.

A crunch time will come in long-running negotiations between Toll and the Government over access fees to the Government-owned track, an industry observer said. Toll could pull services.

Toll NZ chief executive David Jackson said he could not comment on which lines were uneconomic or what would happen to them.

Industry observers said the coal line between Lyttelton and the West Coast and the route between Tauranga and Auckland used by Port of Tauranga to get freight into Auckland are economic, as are milk trains used by Fonterra in the lower North Island.

Beyond that, it is debatable. It is not clear that the main trunk itself is economic and will survive with Toll as the long-term operator at the current fee level.

However, Toll may be painting a bleaker picture than necessary behind the scenes to increase pressure on the Government to contribute to the network upkeep.

Toll is understood to have briefed major customers. The bleak picture may simply be a negotiating tactic.

While Toll will be hurting from higher fuel prices, it should be gaining a competitive advantage over road because of rail's innate greater fuel efficiency.

One of the issues with the Overlander service was the poor state of the network as well as the carriages.

Speed restrictions operating on tracks because of their poor standard added as much as an hour to the journ ey.

There are many legal complexities involved but in the long term other passenger operators can come in.

In the case of freight lines, another operator can come in immediately if Toll gives up a line.

Queensland Rail, the operator that has emerged as Toll Holdings' only real competition in Australia, is seen as the only potential new operator in New Zealand. It has been on the acquisition trail.

The Government recovers all of the expenses of the network from the operators in access fees after investing $200 million in the track when Toll took control of Tranz Rail following its financial collapse in 2003 .

Toll operates most rail services in New Zealand except the Auckland passenger network.

- NZPA

[Paper Tiger]

quote:Originally posted by Paper Tiger

I understand that the Overlander Auckland - Wellington (and vice versa) passenger rail service does not pay it way and will be no more after September.

Weather permitting it provides great armchair views of a range of some of the North Islands great scenery, and I, for one, never tire of that.

Pity it has to go. :(

regards
Paper Tiger

Disc: I am booking myself a trip or two.


Did the trip north today with near blizzard conditions from Taihape to Waiouru where we stopped and threw snowballs at each other.
Great stuff. :D

[kura]

Good on you PT, hope you had a ball (no pun intended)

[Toddy]

PT

Snow balls and good old Railway pies I hope.

[trendy]

Back to the Future....time to nationalize the railways again.....change name back to New Zealand Railways and limit all trucking to 50 mile range [:p]

I remember when they were the only parcel service in town :)

Maybe the answer to the Overlander is to make it a joint passenger/goods/freight service like the old days (mixed passenger). We could even add postal carriages again!

[limegreen]

I just can't believe that the service has been getting longer. Apparently, it was 10.5hrs, has been as bad as 14hrs before the track started getting some serious work, but is still clocking in at 12hrs. That seems like some serious underinvestment in the tracks!! Elsewhere trains are getting quicker and quicker, yet here they're getting slower...

[Paper Tiger]

The current service includes a stop at National Park of 45 minutes for the passengers to have lunch at the cafe in the station. We must be the only country in the world that has re-introduced the refreshment stop.


quote:Tour operators urged to save Overlander (http://www.nzherald.co.nz/section/story.cfm?c_id=1&objectid=10397613)

"Mr Samuels made his call for the Overlander to be developed as a tourism venture when he spoke at a tourism industry conference last night.

He said some tourism operators had spoken to him of the idea.

If the train were reconfigured to better suit tourists - with bigger windows for example - it could become a sightseeing attraction."

The Overlander is fully booked upto and including the (current ;))last run and my informal survey yesterday suggests that there are three types of people taking the train.
1) Those who were travelling purely because it will soon be no more. They seemed to be the majority and I include myself in that category yesterday. Most of these usually travel by car or plane.
2) Tourists who have the time and have heard it is a neat trip.
3) NZers with all day to spare and who do not like the cheaper bus service. (smallest category)

It is already a tourist service and it already has large windows Mr Samuels.

[limegreen]

quote:Originally posted by Paper Tiger

The current service includes a stop at National Park of 45 minutes for the passengers to have lunch at the cafe in the station. We must be the only country in the world that has re-introduced the refreshment stop.


quote:Tour operators urged to save Overlander (http://www.nzherald.co.nz/section/story.cfm?c_id=1&objectid=10397613)

"Mr Samuels made his call for the Overlander to be developed as a tourism venture when he spoke at a tourism industry conference last night.

He said some tourism operators had spoken to him of the idea.

If the train were reconfigured to better suit tourists - with bigger windows for example - it could become a sightseeing attraction."

The Overlander is fully booked upto and including the (current ;))last run and my informal survey yesterday suggests that there are three types of people taking the train.
1) Those who were travelling purely because it will soon be no more. They seemed to be the majority and I include myself in that category yesterday. Most of these usually travel by car or plane.
2) Tourists who have the time and have heard it is a neat trip.
3) NZers with all day to spare and who do not like the cheaper bus service. (smallest category)

It is already a tourist service and it already has large windows Mr Samuels.



Overall, I concur that it is a tourist service. However, it *seems* that it could do both. As I've suggested before here, I think tourist and traveller classes could work, with (gasp) new carriages. Also, tourist level liquor. I had a fantastic bordeaux on the TGV. I suspect that Montanta Sauv. blanc is the best that could be expected on The Overlander? or am I wrong. Do they stretch to a slightly more 'prestige' Montana label (say Stoneleigh?). The train should be about on par with the bus. It was 10 odd years ago, which would be about the last time I travelled on it. When it got to double the price, the choice was easy...

[lakeside]

Well price up in NZ and Australia.
I guess now all the prices go up in NZ and the shareholders in OZ get the dividend.

Family fare on the ferry has gone from $245 3 months ago to $300 so that should help this poor struggling company...poor for how much longer?
Mind you bookings can't be high and blue bridge looks good.

[Happy Camper]

All this Happy Camper wants to know is when the cheque arrives in the mail.

Cheers

[Steve]

Received the T/O doc's in the post this week. The excitement is just not the same when they already have the 90%...

[Happy Camper]

This Happy Camper has just finished filling in the acceptance form. Here is hoping they don't fluff around for too long before going unconditional.

Cheers

[BRICKS]

WELL you KIWI`s have your railways back in one piece and in much better shape TOLL AU had it for four years and it appears to have made a profit of $50+ Million @ year , Good work but TOLL AU still owns the trucks and the sheds for six years rent free, TOLL AU will buy more truck companies the one for my TIP is K&S AU. which has a lot of trucks in NZ time will TELL..