TTP Cash - Where to

[Andrew]

I believe SEA will want to get as much cash back to Hong Kong before our Dollar drops.

Just whether they will give any care to minority shareholder is a concern.

[astro]

The strength of the NZ dollar makes it a very good time to cash up NZ assets and reinvest in Asia. The by-product of the cash up activity is that it crystallises the asset backing per share which is still very high. I believe some of that cash will be used to repay the balance of the bonds and so improving the balance sheet further.
If SEA want cash then the alternatives are a capital repayment which would have to be to all shareholders prorata, or by making a takeover bid. Either of those scenarios is good for minority shareholders too.

[Gofish.]

I suspect that the plan is to lend as much as possible in HK , either to SEA, or to "friends".
Minority shareholders won't get a say, or a bean.
Libel laws probably make it prudent not to say any more, apart from the fact that the majority shareholder has in the past treated minotity shareholders with contempt, and I see no reason for him to change now.
Hope his NZ lackies can pursuade him otherwise.

[Noddy]

Astro. The cash to repay the balance of the bonds is only $17M so TTP could repay anytime they wished.

Most effective use of the cash they currently hold would be to have an on-market share buy back given that the current share price is around 30cps lower than the nta. This will increase the nta for the remaining shareholders (one assumes that SEA would not take part in the buyback this increasing their % interest).

I would very much doubt that TTP could lend funds to SEA or any other related party without shareholder approval (and SEA would not be able to vote).

I have sent a letter to TTP directors expressing my concern over their corporate governance and relationship with SEA. Unless a satisfactory answer is received I will attempt to attend the AGM in May if work committments allow. If I can't I would like to hear from anyone else who plans to attend and is prepared to ask questions (I can give a proxy for 100,000 shares).

Copy of letter to TTP appears below.




19 February 2004



Mr J R Ferner
Brookfields Lawyers
P.O. Box 240
Auckland.1.
New Zealand

Mr CA Peterson
Clavell Capital
P.O. Box 1917
Auckland
New Zealand


Dear Sir,

Re: Trans Tasman Properties Limited (“TTP”) – Corporate Governance

I am writing to you as a shareholder in the company of which you are a non-executive director.

As you are no doubt aware, over the past five years the share price performance has been amongst the worst of any company traded on the NZ stock exchange. Many investors who initially saw their investment as being lower risk with continuing dividends have seen their investment halve in value and have not seen a dividend in years. Over this period the company has been subjected to a takeover bid by its major shareholder at around half NTA, has been subjected to a derivative action by a group of minority shareholders and has been subjected to a shareholders resolution to have the company wound up (defeated only by virtue of SEA Holdings 58% shareholding). I note that of the directors only R.J Hodge holds share in the company in his own right (4,500 as at 31/12/02).

My concern and that shared by other minority shareholders is the perception of the lack of good corporate governance within the company.


Specific concerns are;

• DI Fletcher is both CEO and Chairman yet the 2002 annual report shows both he and DJ Hodge as holding 328 million TTP in their capacity of directors of SEA Holdings NZ Ltd, a subsidiary of SEA Holdings Limited. How can both directors fairly represent the interests of all shareholders when they are also directors of the majority shareholder? Also as you are no doubt aware recent trends in Corporate Governance suggest that the role of Chairman should not be filled by the CEO (I refer you to the Bosh report on Corporate Practices and Conduct 1995).

Lu Wing Chi is a director of SEA Holdings Limited and is also a director of TTP. Again how can he fairly represent the interests of all TTP shareholders when he is also a director of the majority shareholder?

Currently three of the five TTP directors are also directors of the majority shareholder or its subsidiaries. Given that this represents 60% of the Board, one would have to conclude that the Board is controlled by SEA Holdings Limited. Unfortunately it is perceived by the minority shareholders that the interests of SEA Holdings Limited and the minority shareholders in TTP do not coincide. This is especially so since SEA Holdings unsuccessful attempt to buy out the minority shareholders (at a considerable discount to asset backing) and defeat of the shareholders resolution to liquidate the company.

I refer you to the 2001 annual report page 3 which states “At the time of the 2000 Annual Report, the Board had announced a proposal under which shareholders, excluding SEA Holdings Limited, and holders of Convertible Capital Notes (“CCNs”) would be offered the opportunity to exchange those securities for interest-bearing Secured Bonds”. This reads as if it was the Board which submitted the proposal when in fact

[Gofish.]

Noddy, thats a very good letter and thanks for making the effort to call them out on their behaviour.

Can I also suggest you also CC the NZX, and the NZ Shareholders association. If the independant directors are aware the issue has the potential to grow they might just take the time to make a reasonable reply. Shining light into the crevices these people hide is the only chance for minority shareholders.

[Noddy]

quote:Originally posted by Gofish.

Noddy, thats a very good letter and thanks for making the effort to call them out on their behaviour.

Can I also suggest you also CC the NZX, and the NZ Shareholders association. If the independant directors are aware the issue has the potential to grow they might just take the time to make a reasonable reply. Shining light into the crevices these people hide is the only chance for minority shareholders.


Yes I sent a copy to the NZ Shareholders Association. I don't think a copy to NZX would do much good as they have not broken any stock exchange rule. The day after I sent the letter the NZ Securities commission came out with their recommendations for corporate governance which was very much in line with the suggestions I made to TTP.

I will post the reply if I get one. The only effective way to at least put the directors on the spot is to front up to them at the AGM. The way this company has treated the minority shareholders in recent years would result in a riot in other countries.

By the way. From what I see I very much doubt that there are any independent directors in TTP. JR Ferner is a partner in Brookfilelds lawyers which continues to earn fees from TTP (from fighting the minority shareholders I guess).

[Andrew]

Ross Securities Offer may not look too bad soon.

[Noddy]

So TTP has purchased a property in Hong Kong. Knowing HK and the area its probably a good purchase especially given the strenth of the $NZ against the US/HKD. But why have they not given more details like the annual rental.

Of most concern is that the company is being taken in a totally different direction from what most shareholders have expected and there has been no consultation with shareholders (other than SEA of course).

[Oracle]

Noddy

Its probably all part of the plan to piss shareholders off, prior to SEA making a cheap offer, to takeover.

What has happened so far!!

Not paid back all Notes.
No dividend.
Talked of move to Asia.
Knocked share price down from announcement date.
No mention of nta of 63.5 cents in the announcement (refer to NBR).
Selling AK properties (to get cash?)
Buying token property in Asia.

Benefits to SEA ...Discount of say 13 cents on each share they takeover. Take tax losses over for themselves.

[bermuda]

Article today in NBR re SEA/TTP Don Fletcher re Jack's Point Queenstown.Apparently the project was offered to TTP but the Board turned it down!!!!

[Noddy]

Good corporate governance says that directors can not take advantage of corporate oppertunities even if they have been turned down by the board. The exception is where permission has been granted by the shareholders in general meeting (interested parties being unable to vote).

Case law confirms this view. The theory being that if directors are able to take corporate oppertunities declined by the board then whilst they are board members they may not explore all options to enable the company to take advantage of such opportunities. In this case any profit derived from the venture belongs to the shareholders (even if they have not contributed funds).

I really want to attend the May AGM to confront this pack of b****s. Maybe we should form a TTP action group ?

[Andrew]

Fletcher will probably need something to do when TTP sells off their remaining properties. They may give one to Fletcher as a bonus.

I see the HK purchase as a token purchase to scare shareholders, dropped the price 2 cents, about 10 million in capitalisation, for a 7.5 million purchase. Wow shareholders are nervous aren't they.

The HK purchase was probably a good move provided they didnt buy it from one of the associated entities or compadriots.

[Andrew]

Just had a thought. I wonder what they will get for that supply firm they foisted on us last year.

THE KING says wonder how many times a dog has to bit you before someone says Ouch,......... Andrew did you read my PPG story.:)

Regards THE KING

[Andrew]

Yes but King if you bought TTP 2 years ago for 17 cents and bought and sold on the volatility for which there have been plenty, this stock looks good. There is no way Postie Plus will double in price.

maybe volatility.

I think any stock that is selling for 1/2 NTA must be worth looking at.

Methinks you protest too much. I respect you king but dont get angry when I rubbish you next purchase, after all I have followed you through MAP and am happy with CSR at the moment.

[KentBrockman]

Trans Tasman buys prime Hong Kong retail property

10.03.2004
By ANNE GIBSON
While Trans Tasman Properties is hoping to sell a large chunk of inner-city Auckland properties, it has made its first step into Asia.

Its Auckland real estate on the block forms part of the Finance Centre, developed in the 1980s. Trans Tasman has a contract to sell the collection of adjoining towers, conditional on the buyer getting finance.

"An announcement will be made if and when this goes unconditional," said Trans Tasman chief Rod Hodge yesterday.

As signalled by executive chairman Don Fletcher at the annual results announcement last month, the company is buying in Asia and this month said it would pay $7.5 million for Hong Kong's Excelsior Plaza.

The retail property in the Causeway Bay precinct in Hong Kong has one of the highest pedestrian counts, Trans Tasman said.

Fletcher said he was looking toward Asia because it offered better buying opportunities than Australasia, where the market was slowing, the company's strategy was to sell at the top and buy at the bottom and the Asian markets were starting to improve.

Trans Tasman already has a strong Asian connection. Its 55 per cent stakeholder, SEA Holdings and its managing director, Jesse Lu, are based in Hong Kong.

The properties in the Auckland sale are the 23-level Qantas House (17,528sq m) at 191 Queen St, the 16-level Brookfields House (10,592sq m) at 19 Victoria St West, the three-level Durham House (1683sq m) at 22 Durham St West.

Carparking on Queen and Victoria Sts are involved in the deal.

Although the properties have different addresses, they are all part of the former Chase Corporation/EIE holdings developed into the Finance Centre. Excluded from this deal is an Albert St tower which was also part of the centre.

Trans Tasman general manager Bruce Catley said the company bought the properties in 1995 and all were refurbished and fully tenanted.

One property analyst said the buildings would generate an annual rental income stream of about $5 million but that the buildings were not considered prime.

[Noddy]

Don Fletcher says he has a strategy for TTP of buying property at the bottom and selling at the top. Given that he has halved the company's value in 5 years that just fills me with so much confidence.

THE KING says well boys their goes your Xmas box and may be by this time next you wont even own a prop in NZ.. suckers are born all the time.....:D:D[8]:D:D

[bermuda]

Bermuda says there will be a takeover offer.This company has an almost transparent asset backing of at least 64 cents per share avialable in cash and with well identified and well leased properties.It's there for the taking.Someone will make a swoop soon. It is just all too obvious.

[Unicorn]

Cash and deposits listed in the full year announcement were $282M. That equates to 47cps of cash on hand. So the share price is sitting at 76% of the cash on hand!

Only SEA can make a takeover offer, unless they are prepared to sell their holding - and this does not appear to be likely. They are probably quite happy with the current arrangement, forcing the price well below true value and using their creep capability year by year to buy from disheartened sellers.

The board is sailing very close to the wind regarding their responsibilities to shareholders. If things continue this way, the individual board members risk some very large lawsuits from minorities. Given that SEA has already used its creep allowance for the year, I see the next logical step being a share buyback. This would allow SEA to use the companies own funds to buy out minorities at well below asset backing. I think it is likely that this will happen sooner, rather than later as the directors must be getting very uncomfortable about their potential personal liability.

Various actions in the past couple of months seem to have set the stage for an offer in the 45-49c range (a 25-35% premium to 'market' price). Perhaps the AGM might be where this is announced.

[Noddy]

For those of you who have read my letter to the two TTP independent directors. I have today surprisingly received a reply and a copy is posted below. The reply is very much as one would expect at this stage of the game.

I would like to follow this up with another letter about SEA/Don Fletcher's investment in Jacks Point, Queenstown. I understand there was something about it in last weeks NBR. If anyone can locate this and get a copy to me or a re-write on this site I would greatly appreciate it.

Letter is as follows;




Dear Sir

Thank you for your letter dated 19 February 2004.

John Ferner and I, TTP’s independent directors, have discussed your letter and respond as follows.

We see one of our prime roles as being that of monitoring the Corporate Governance of TTP. We are confident that TTP has a high level of Corporate Governance and take seriously any assertions that it is less than it should be.

With respect to the three points raised in your letter, which you would like raised at board level, we will undertake to specifically discuss these matters at the next board meeting, bearing in mind that all three issues are regularly the topic of board debate in one form or another.


Yours faithfully,


CARL PETERSON

Copy to: Mr John Ferner
Mr Don Fletcher

[Andrew]

It doesn't hurt to keep bringing up the matter. After all the independant directors are the ones who are going to be sued one day?

There must be a move made one day soon. SEA can not avert the payment of a dividend, and then each year buy up shares on a creeping program. In fact their tactic seems quite clear as they have purchased as much as they can, so now obviously they can not act in their own interest.

I would agree a share buyback is coming up. I think you are right also, it must be announced as a part of the annual general meeting.

However that brings up another matter. If there is a share buyback, SEAs effective interest in the company is increasing. Would that be against the takeover code and the creeping program.

What that does to the share price is another matter.

[Unicorn]

The code allows exemptions....
(1) Every person who increases voting control as a result of the acquisition by a code company of its own voting securities is exempted from rule 6(1) of the Code in respect of that increase in voting control.

(2) The exemption is subject to the condition that—
(a) the acquisition is approved by an ordinary resolution of the shareholders of the code company; and
(b) neither the person nor any person who is or was at the time an associate of the person voted in favour of the resolution; and

[KentBrockman]

http://stockwatch.nzherald.co.nz/announcementdetail.asp?GMC=100&ArticleId=98657

[Onthemoney]

Congratulations to those that held out for so long, it looks like your time has come.....

[bermuda]

As I said before TTP would have to be the most outstanding buy on the NZ stockmarket.It's value is transparent at over 63 cents per share and a takeover offer was always coming.SEA will probably try something cheeky but I am betting it won't go for less than 60 cents.There is still a bit of stock available below these levels so get in now and have a safe feed...Cream always rises to the top...it's just a matter of time.

[Noddy]

Well Andrew its been a hard road to follow but maybe some light at the end of the tunnel. At some stage SEA had to gain 100% inorder to gain TTP's cash flow. Regretfully they do have to pay for the minority holding to gain control.

Will be interesting to see the bid. Can't see it being below 55c just hope its not another of those time payment schemes. If shares representing 10% of total hold out I think they have to get an independent valuation in which case 60c plus should be the valuation.

[Oracle]

etc.

I have not endured the pain of some others, having purchased my current holding since December. Bought my last ones yesterday. I was reasonably confident as there has been someone (it appears), knocking the share price back since the date of profit announcement. Even last night they dropped 100,000 on to keep price at 35 cents.

I would expect something around 53 cents.

[PrinceofWhales]

TTP
30/03/2004
TAKEOVER

REL: 1757 HRS Trans Tasman Properties Limited

TAKEOVER: TTP: Takeover Notice Received

Trans Tasman Properties Limited has provided the following Takeover Notice
provided by SEA Holdings New Zealand Limited.

Takeover Notice:

SEA Holdings New Zealand Limited (SEANZ) hereby gives notice pursuant to rule
41 of the Takeovers Code (the Code) of its intention to make a full offer to
acquire all of the voting securities in Trans Tasman Properties Limited (TTP)
not already held by SEANZ as at the date of the offer.

Attached is the form of offer document proposed to be sent to TTP
shareholders. It includes the information specified in Schedule 1 to the Code
which is required to be contained in, or to accompany, this notice.

If SEANZ proceeds to make the takeover offer, the offer to TTP shareholders
will be made in the form of the attached offer document, with any
modifications and additional information permitted or required by the Code.

Don Fletcher
Director
SEA Holdings New Zealand Limited

Letter to Shareholder:

I am pleased to enclose an offer document that describes the full offer (the
"Offer") under the Takeovers Code for the shares in Trans Tasman Properties
Limited ("TTP") that are not held by SEA Holdings New Zealand Limited
("SEANZ"), a subsidiary company of SEA Holdings Limited ("SEA"). SEANZ
currently owns 59.97% of TTP.

Summary of the offer:
SEANZ is offering 40 cents cash per share
The Offer opens on 20 April 2004 and closes on 20 May 2004.

The Offer price represents a premium on TTP's share price immediately before
the Offer was announced.

Reasons for the offer:
SEA has been the major shareholder in TTP for ten years. SEA has consistently
supported TTP's business strategy which has centered around property
investment and development in Australia and New Zealand.

During 2003 and 2004, TTP has articulated strategies which may see increased
weighting towards investment and development in the wider Asia-Pacific region
as counter-cyclical opportunities arise.

SEA supports TTP's initiatives and has on many occasions confirmed its long
term investment commitment to TTP as a going concern. However, SEA
appreciates not all TTP shareholders agree with TTP's strategic plan.

Opportunity for TTP Shareholders
This cash offer provides the opportunity and liquidity for those shareholders
who wish to sell their shares in TTP other than through the New Zealand Stock
Exchange.

Terms and Conditions of the offer have also been provided.
End CA:00098670 For:TTP Type:TAKEOVER Time:2004-03-30:17:57:11

[Noddy]

Wow 40 cents per share. Only 3c below where they were before the profit announcement and 39% below assets backing. Are these guys serious. There is no way this offer will be accepted.

Interesting to note that the offer document is signed by Don Fletcher as director of SEA. So he represents SEa against the interests of minority shareholders in TTP yet as a director and chairman of TTP he has a duty to represent all TTP shareholders. This is such bull**** and is exactly the issue I raised in my letter to TTP directors (see earlier entries on this tread). I really think its time Don Fletcher was called to resign from the board.

Guess we will all end up poaying for an "independent" analysis that says 40 cents is fair. Lets liquidate this company and all get 60c plus. What a joke.

[whatsup]

ARE THESE GUYS FOR REAL, or is this just another B/S offer from a bunch of IMHO b-ll sh-t bunch of sl-pies trying to get a screw out of poor gullliable shareholders? PLEEEEEEASE

[blackcap]

SEA showing their true colors.

Have they been charitable in the past? Anything to indicate they were going to be charitable in the future? Off course not.

But this has got to be the lousiest offer I have ever seen. Considering the shareprice was at 42 cents only a month ago.

What a bunch of miserly b######

But then again, SEA are out to maximise their shareholders wealth too are they not, just as shareholders in TTP were trying to do. Its just their methods may leave a lot to be desired. T(hat is purely my opinion).

It will be interesting to see what reaction this offer receives and if something comes off it.



Disc- none held, but have been looking and have traded a few now and then.

[Unicorn]

These guys are for real. If they can get away with it SEA will take what they can at 40c, then go back to depressing the share price so they can have another bite later. This technique allows SEA to increase its holding by more than the 5% allowed by the creep provision.

Unless I have read the code wrongly, once a holder gets above 50% there are no limits on how much or little they can pick up during a code offer. The limitation is that a holder cannot sit between 20% and 50% - but that does not apply here. There is probably a weakness in the Takeover Code - in that there is no requirement for a majority holder to make a fair offer until the 90% mark is passed. SEA and TTP directors seem to be making a strong case for a law change by offering below current and historic market price.

There will be no independent valuation, because SEA will settle for (much) less than 90% at this stage. I imagine that they will take whatever they can get. Perhaps they will raise the offer, but I cannot see them going above 49c.

The AGM should be quite interesting. Perhaps minority holders should write to the independent directors and request another windup resolution to be put to the AGM - might save the cost of another EGM!

[clearasmud]

Why wasn,t there a trading halt placed before the initial notice was made?
This is totally unfair to those who had cheap sells on.

[Oracle]

unicorn

I would expect that the Independent Directors would make a recommendation to shareholders, but need an independent valuation first. Then we may see the real offer. (45cents?). This .40 is probably just part of the process, a reminder to shareholders as to what they are dealing with.

I would like to have confirmed, who was doing the selling since the announcement date. The day of the announcement, in the moments before its release, there was a round 500,000, waiting at .42, to knock it down. Further lots of 1,2 & 3 hundred thou have kept the price in check. It certainly did not look like normal market action to me!

[Unicorn]

The Independent Directors are, I believe, the same ones who recommended shareholders accept the 35c offer a couple of years ago when asset backing was reported as 10% higher than it is now - shareholders rejected that one resoundingly!

[Oracle]

The independent val at the time was .30 to .40.

The quality of the assets has improved considerably. There were write-downs, post the last offer.

With the amount of cash & quality of assets, independent val would have to be at least .50.

I believe there will be another offer. They would do well at .50.

[bermuda]

Unbelievable!!Fortunately this offer wont go anywhere.Does Don Fletcher work for Ross Investments.?? Or is he a SEA puppet?? This behaviour is unacceptable.Come on SEA,..a fair shake of the dice please.

[Unicorn]

How does the cancellation of the deal to sell the Auckland properties fit into this? Having those as assets rather than cash should allow a valuation to come in lower. Coincidence?

I hope you are right Oracle. I bought recently and am able to exit happily at 45c, even though that is below fair value.

I can see the offer being withdrawn (which would knock the price back) and possibly a share buyback put in place (to 'rescue' the poor minorities). Thus SEA could use TTP's cash instead of it's own, which might be useful given that it is unlikely to obtain the 90% it wants.

[Noddy]

Actually when you consider that offer some two years ago was 35c plus 10% interest todays offer is actually worse as 35c + 10%x2 is 42c (exact time period and tax implications aside).

These guys are not serious. Given that 3 of the 5 directors are also directors of SEA how can they make a recommendation to shareholders. Also our friend Don Fletcher must be in a bit of a bind. As a director of TTP his role is to try and increase the shareprice (shareholder wealth) yet given that he is also a director of SEA one of his objectives must be to depress the TTP shareprice (for cheap takeover bid). Poor fellow how does he sleep at night.

Next AGM in May should be a doozy. Pitty its on the 5th May. If after that I could attend. How about a resolution that Don Fletcher and other three SEA directors on the board resign (conflict of interest). Or a resolution the company be wound up. Maybe SEA could be given property and cash equal to the value of their 58% and then f... off.

NZ Corporations Law could almost be rewritten on the basis of what SEA are doing to the minorities. Corporations Law here in Australia could see the company funding the minorities action to remove the SEA directors.

[lewinsky]

In the Annual Report that arrived in the mail yesterday,TTP is holding cash at bank of $282 million,or 47 cents per share. The total net assets per share is 64 cents. The SEA offer at 40 cents then discounts the value of cash that it is holding. Shareholders would be better served by selling the properties that it holds and returning the cash to shareholders and burying the company. Only problem is that the majority shareholder and directors wouldn't have a cow thats being milked before the minority shareholders get any return.

[whatsup]

Why is everyone up in arms about the way the Asi-n ultimate owners are doing this t/o IMHO its the normal way of the Asia- mind to screw the other side in any business deal ,wake up Kiwis were not dealing with the Salvation Army here,IMHO the real point is will/should anyone take up their offer? only a total rejection of the offer/scam will send a message!!!

[Andrew]

I'm not selling for less than 48 cents. Miserly pricks. In their preamble they say that they are the driving force behind TTP and they deserve it all. What a lot of rot. They were the ones who drove the share price from 80 cents several years ago to what it is today.

[MeNoBatty]

Quote from Don Fletcher in todays Independant; "we [the board] are at great pains these days to make sure that our disclosures are full and frank and that the share holders know that."

Yeah, right, whatever....

[astro]

There is nothing surprising about this offer. It follows the similar takeover offer for the AGP last year where the independant advisors said that while the price was only 80% of what the company was worth, it was fair. I expect that an offer of around 80% of asset value, in this case about 50c per share, would be deemed to be fair. I don't think the independent directors could advise acceptance of the offer unless the price is increased to around that level. It will be interesting to see what professional advisors they engage, and whether they are truly independent. It would strain credibility if they recommend acceptance at the 40c level.

Astro they will recomend offer on the basis it is the best you are going to get or do you believe in the bigger fool theory.

[Oracle]

Enigma

I am confused by your post, your opinion! I note that you bought at .42 in the game! Please clarify!

[tim23]

Annual report in todays pot net assets 63c per share, so I figure 40c is a bit light!

[COLIN]

quote:Originally posted by tim23

Annual report in todays pot net assets 63c per share, so I figure 40c is a bit light!

I'm certainly not letting mine go for less than 50c (which is 80% of NTA, as reported), and would expect a lot more than this. The company has cleaned up its property portfolio over recent years and of course is sitting on a large dollop of cash, which means that at 40 cents SEA would be getting the properties for a whopping discount!
I know that "oppression of minorities" will otherwise continue, e.g. no dividends, etc., but, like those stubborn Tranz Rail holders, my inclination would be to sit this one out unless SEA can come up with a whole lot more enticement to sell.
Apparently Grant Samuels is one of the "expert" appraisers. I know that others have had doubts about their performance in past situations, but I would be absolutely astonished if they could find 40 cents "fair and reasonable".

ORACLE I am not in the Game and would not touch with barge pole Back to the time when Bob Jones declared they would not pay dividends. An my accountant asked me if I bought those shares what was my intention. He said you must have the intention to sell when you bought them. As how else would you realize anything from your investment. This could also taint any other share buying you did as far as a tax investigation was concerned. This is the same reason I did not buy GPG shares years ago. Please inform me if you discover who is masquarading as me.

[Noddy]

Interesting reading is the April 2001 appraisal report prepared by Grant Samuel in responce to SEA's 35c 10% bond offer. I have also compared the 2000 annual report with the 2003 report.

A few observations:

2000 Debt excluding cash on hand (000's) 643,235. 2003 20,542
2000 Equity ratio 32%. 2003 77%.

Grant Samual used the high debt level as a basis for their low valuation of 30-40 cents per share. Share price at the time was 19c.

Profit for 2000 was 23,525 - 32,587 revaluations = (9,063)
Profit for 2003 was 24,300 + 16,300 revaluations = 40,600

Grant Samual used possibility of negative revaluations and over renting as a basis for their low valuation. Subsequent events don't seem to have upheld this theory.

Grant Samual stated that SEA has indicated that it is not willing to make a takeover for the remaining shares. This has turned out incorrect also.

Grant Samuel stated "The discount to NTA is the largest of any listed property stock in New Zealand at 69% (2003 54% pre bid). In Grant Samuels opinion, the share price of Trans Tasman is artificially low, due in part to the decision of the directors in February 1999 to stop paying dividends". - I can certainly agree with this.

So who thinks the next appraisal report will come in higher than 40 cents ? My thoughts are that it could not be anything less than 55-60 cents.

Of course it is irrelevent if SEA will not increase their bid. I do not expect them to. They are probably only expecting to pick up another 5-10% from gullible shareholders ie. they are doing a "Ross Investments". Shareholders will not receive full value until SEA breach the 90% mark. In the meantime shareholders should push for an on market share buyback and restoration of dividends. TTP's current capital structure is better than many other listed property stocks. Non of which trade at more than a 10% discount to NTA.

[whatsup]

I personally would'nt get Grant Samual to value time!!!!

[Oracle]

Noddy

We all agree on the character, of the major shareholder. However I think they have too much to lose by not going for a takeover at about 53cents, now. Get all the shares at a 15% discount. Get their hands on all the cash. Get all the tax losses. This is a better option for the greedy!

What happens if they get over the mark needed to delist the company and what percentage of the issued shares is required

[Unicorn]

90% is the magic mark ... no show of getting anywhere near at 40c.

Read about it here http://www.takeovers.govt.nz/code/business.htm

[Unicorn]

Looking at the Financial Statements, there is a New Zealand tax loss of $46M (7.7 cents per share) yet this has no value in the books. Is it normal practice to place no value on something that significant?

Unicorn Not a takeover just A delisting and you are locked in to a private company. Have had it done to me years ago. Saves all the share registry and listing fees. And no market for small shareholders to sell and no dividends.

[Noddy]

To be delisted I think would require a special resolution of shareholders which means 75%. If SEA were to acquire this level and seek to delist there are remidies available as an oppressed shareholder ie. the company would have to buy your shares at fair valuation.

Isn't it interesting that that eveyone thinks (knows) that SEA are out to rip them off yet with 3 out of 5 directors on the board they control the company. Yet the directors are ment to look after the interests of all shareholders. I'm starting to sound like a broken record here.

Has anyone got any input from the NZ Shareholders Association ?

[blackcap]

Here is the problem Noddy:

Companies Act 1993, Directors Duties to shareholder are (sec 169,3)

Sec 90 Duty to supervise the share register
sec 140 duty to disclose interests in company transactions and
sec 148 duty to disclose dealing in companies shares.

These are the ONLY duties owed to shareholders by directors.

The other duties, e.g. sec 131 to act in good faith and coys best interests, and sec 133 to exercise powers for a proper purpose are however stated to be owed to the COMPANY and NOT to shareholders.

So directors dont actually owe duties to shareholders as such (except for the three listed above), but their duties are owed to the company.

[star]

Noddy, I read the letter replied by one of the directors. I do not think they will admit their corporate governance problems even though what you have addressed is dead truth. From my memory, last year NZX had a proposed listing rule change which includes a few clauses on independence issues (in response to Enron and corporate governance issue in Amercica). You can go to NZX's website to find it out.

For this company, my suggestion is as long as you can get your orignal capital back, sell all of your holding and find a good reputable company.

Good luck!

[COLIN]

At 40 cents the discount to published NTA is $140m. At last balance date there was sufficient cash in hand ($282m) to satisfy nearly all borrowings so, in effect, the majority shareholder is saying that the $378m of "Investment and Development Properties" are worth only $237m (594 million shares at 40 cents). If this is the case then why on earth are they not written down in the books to this value? If they are in fact worth their stated value (by registered valuers) then the offer is risible.
(There are also about $60m "other assets" which roughly match other liabilities and can be ignored for the purposes of this exercise). Quality Property Companies should normally be valued at close to market value of their property portfolios - certainly not at a whopping 37% discount! One might reasonably expect to see significant discounts in the case of manufacturing, trading, companies, for instance, where stock, plant, etc., might fetch well below book value in a forced sale.

In the words of Dad's Army: "Who are you kidding, Mr. Hitler?!" This is a blatant case of oppression of minority shareholders, and should be a good opportunity for the Shareholders Association - which I must join - to take up the cudgels in the knowledge that it is far, far away from a fair deal.

[Oracle]

Colin

They are not saying, this is all the shares are worth. They are saying, this is what we'll pay! No connection between "worth" & price.

[bermuda]

NBR this morning page 3 and page 48 highlights the cheeky bid by SEA which illustrates how SEA may be using this takeover bid to get around the 5% annual creep provisions.Worth reading.

[lewinsky]

Have the independent directors appointed anyone as advisers yet? I may have missed this, so if so apologises.Is it Grant Samuel?

[COLIN]

quote:Originally posted by Oracle

Colin

They are not saying, this is all the shares are worth. They are saying, this is what we'll pay! No connection between "worth" & price.



True, true, but I am merely trying to highlight the full extent of the discount and the reasons why I will certainly not be accepting such an insulting offer. No other bidder is likely to emerge because they would know full well that they could not prise SEA's controlling interest from them. That is why I see the playing field as being un-level, and why I feel oppressed - and depressed and disposessed!

[Noddy]

quote:Originally posted by blackcap

Here is the problem Noddy:

Companies Act 1993, Directors Duties to shareholder are (sec 169,3)

Sec 90 Duty to supervise the share register
sec 140 duty to disclose interests in company transactions and
sec 148 duty to disclose dealing in companies shares.

These are the ONLY duties owed to shareholders by directors.

The other duties, e.g. sec 131 to act in good faith and coys best interests, and sec 133 to exercise powers for a proper purpose are however stated to be owed to the COMPANY and NOT to shareholders.

So directors dont actually owe duties to shareholders as such (except for the three listed above), but their duties are owed to the company.



Blackcap.

What you have listed are the NZ Statutory duties of directors. There are also the common law fiduciary duties which are:

* To act in the bona fide best interests of the company
* To exercise powers for their proper purpose
* To avoid conflicts of interest
* To retain their discretionary powers

Whilst a breach of a statutory duty is actioned upon by the Companies Office a breach of a fiduciary duty is actionable by the shareholders.

Question is "what is the company" The company is generally regarded as the body of shareholders and so directors must act in the best interests of ALL SHAREHOLDERS.

So do you think Don Fletcher and the other directors have and are acting in the best interest of all shareholders ? Looking at each of the fiduciary duties;

To act in the bona fide best interest of the company. --- Is it in the best interest of all shareholders that no dividend is paid, or there has been no on-market share buyback, or they have not supported the liquidaton of the company's business assets.

To avoid conflicts of interest. --- Clearly there is a conflict of interest as the interests of SEA and the other shareholders are not the same. Don Fletcher can not represent the company's interests and SEA's. (Also relates to using powers for a proper purpose)

To retain their discretionary powers. -- Have the independent directors retained their discretionary powers or have the abrigated them to Don Fletcher and the other SEA directors ?

Interesting in it not. Here in Australia we have S236 of the Corporations Act known as a "members derivative action" where a member can bring proceedings against a director in the name of the company for a breach of duty.

Whilst NZ does not have the same legislation (to my knowledge) there is actually nothing stopping a shareholder from bringing an action against a director for a breach of duty. Of course cost is a factor. Possibly Latimer Holdings would have been more successfull had they taken action not as an oppressed shareholder but rather for general breaches of directors duties.

Any comment by a commercial lawyer would be appreciated.

[Nightmare]

Noddy,

A case was brought against SEA and TTP by a Christchurch shareholder a year or so ago on similar grounds as you have articulated - it was thrown out by the High Court.

It is hard to see SEA increasing its offer anytime soon and once its bid lapses, share price will fall back below 40 cents again. For the big shareholders who bought in well below 30 cents, this could be their chance to get out before TTP moves its operations to Asia. [xx(]

[Noddy]

quote:Originally posted by Nightmare

Noddy,

A case was brought against SEA and TTP by a Christchurch shareholder a year or so ago on similar grounds as you have articulated - it was thrown out by the High Court.

It is hard to see SEA increasing its offer anytime soon and once its bid lapses, share price will fall back below 40 cents again. For the big shareholders who bought in well below 30 cents, this could be their chance to get out before TTP moves its operations to Asia. [xx(]



Nightmare

The case a year ago involved shareholder oppression. What I was talking about was directors duties to shareholders.

A seriously don't think the talk of a move to Asia is anything other than that. Talk to throw more doubt and insecurity into the minds of shareholders and to depress the share price. Volume of shares traded since the announcement of "takeover" have been over a million on most days. This is not small shareholders buying in and whilst it is probable that the price might fall below 40c after the bid is over it probably puts a floor under the price before the "real" takeover bid.

Anyone selling out at 40c is selling themselves short.

[blackcap]

Noddy, points noted. I was in a way playing devils advocate, and in NZ you can take derivative action too.

What I was trying to point out is that in some circumstances it is difficult for shareholders to take action.

Also TTP would argue that they are acting in the interests of the majority of shareholders, SEA holding more than 50%.

[Noddy]

TAKEOVER: TTP: TTP Appoints Independent Adviser The independent directors of Trans Tasman Properties Limited ("TTP") wish togive notice that the Takeovers Panel has approved the appointment of FerrierHodgson to prepare an Independent Adviser's Report for TTP in relation to thetakeover offer announced by SEA Holdings New Zealand Limited.


Thought this firm was more an expert in company insolvency and liquidations. Still they should at least have an idea of how much the break up value would be.

Anyone want to start a bet on where they will place fair value. I'll pick 57c.

[bermuda]

For those disgruntled shareholders who have not already done so I urge you to log on to www.latimer-holdings.com/news.htm and then click through to an announcement by the Secretary of SEA Holdings on 12 February 2004.This signed statement details the annual results of their subsidiary TTP and clearly states that the net tangible asset value of TTP is now 63 cents.This statement has clearly shot themselves in the foot and I believe will land them in an untenable position regarding their offer of 40 cents.The independent directors have now appointed a company to assess the offer and I am sure that SEA will have to be raise their offer accordingly.If they reach a target of 90% then the remaining 10% can sell at an independent valuation which could then well realise 63-70 cents.

[Unicorn]

Bermuda, the offer of 40c cannot have been intended to get SEA to the 90% level - it is patently too low for that. Probably more a case of mopping up what they can as cheaply as possible before any serious attempt. In my view that is bad strategy as the independent valuation is unlikely to help their cause.

I can see 3 outcomes ...
1. SEA take the few that might be offered at 40c and are happy with that for the meantime (gets them around the creep provision).

2. SEA raise their offer (I can't really see them going over 50c, not their style).

3. SEA withdraw the offer, letting price settle back below 40c (hoping this makes holders more willing to sell next time).

In my view TTP holders are unrealistic to expect 63c. The majority holder does warrant a premium for that stake, but not to the extent implied by their 40c offer. On the other hand the 63c asset backing is arguably on the low side - excluding tax losses of over 7 cps among other things.

The independent valuation will first need to assess asset backing - my guess is they will come up with about 66c. Then the discount on asset backing that is appropriate given the asset profile and allowing for control premium - my guess is 20%. So 53c seems justifiable, and in line with the AGP experience. Not that SEA need take any notice of the independent advisors report.

[bermuda]

Unicorn,I go along with your thinking.
What I was suggesting is that if SEA raise their offer and somehow gain 90 % then the remaining 10 % could seek a further independent valuation which SEA would be obliged to pay.This valuation could yield those shareholders 63 cents or more.However I agree that SEA dont appear overly anxious to increase their sharehoding at fair value so we might just have another stalemate.

[Contrarian]

TTP07/04/2004TAKEOVER REL: 1703 HRS Trans Tasman Properties Limited TAKEOVER: TTP: Takeover Offer Price to Remain 40cps SEA Holdings Limited has advised the Takeovers Panel of the following: Since the announcement of the takeover notice by SEA Holdings New ZealandLimited ("SEANZ") (a wholly owned subsidiary of S E A Holdings Limited ("S EA")) on 30th March 2004, the TTP share price has been trading above the offerprice of 40 cents per TTP share. S E A believes this may be due in part to speculation that its offer pricewill be increased above 40 cents per TTP share. The letter submitted by the Chairman of S E A and attached to the takeovernotice, clearly sets out the offer price and the reasons for the takeoveroffer made by SEANZ (a copy of which is attached). To clarify the position, S E A advises the Takeovers Panel that this is S EA's final offer and S E A will not increase the offer price above 40 centsper TTP share.End CA:00098988 For:TTP Type:TAKEOVER Time:2004-04-07:17:03:20

[Noddy]

quote:Originally posted by Contrarian

TTP07/04/2004TAKEOVER REL: 1703 HRS Trans Tasman Properties Limited TAKEOVER: TTP: Takeover Offer Price to Remain 40cps SEA Holdings Limited has advised the Takeovers Panel of the following: Since the announcement of the takeover notice by SEA Holdings New ZealandLimited ("SEANZ") (a wholly owned subsidiary of S E A Holdings Limited ("S EA")) on 30th March 2004, the TTP share price has been trading above the offerprice of 40 cents per TTP share. S E A believes this may be due in part to speculation that its offer pricewill be increased above 40 cents per TTP share. The letter submitted by the Chairman of S E A and attached to the takeovernotice, clearly sets out the offer price and the reasons for the takeoveroffer made by SEANZ (a copy of which is attached). To clarify the position, S E A advises the Takeovers Panel that this is S EA's final offer and S E A will not increase the offer price above 40 centsper TTP share.End CA:00098988 For:TTP Type:TAKEOVER Time:2004-04-07:17:03:20



Well no surprise here. Nobody thinks this is a serious attempt at a takeover. Just an attempt to mop up the weak sellers.

What is more interesting is that SEA did not need to make the announcement. So is just another move to try and keep the share price down.

[Oracle]

Or them & their mates buying now at .40...42, before they have to make an offer, with a real price. That announcement is like the ones Toll Holdings made, re TRH.

Winston had it right!

[bermuda]

Think I had better ask the Overseas Investment Commission if they are happy about SEA,a Hong Kong based company registered in Bermuda putting in a cheeky bid for total ownership of $250 million plus of Auckland Commercial Buildings and also what they think of them picking up a majority equity in Jack's Point Queenstown.Hopefully they have applied for permission and if not,why not.

[Nightmare]

Bermuda, why should the OIC be involved in determining what is a fair price or not?

Should the OIC have been involved for example in assessing that IP overpaid for Carter Holt ten years ago at $3.80 per share? Or that SEA overpaid for its entry into the NZ property market in the first place? Ludicrous proposition surely.

SEA has made an offer and if shareholders don't like the offer, reject it and try to get SEA to up the offer. If they refuse to up the offer, that's commercial reality. That's their perogative.

Posters should also take into account the debt that's sitting in TTP's balance sheet before talking darkly about TTP's cash being used to takeover itself. It's net debt that matters - not how much cash a company has. Remember Air NZ's famous $1 billion cash just before it had to be bailed out by the NZ Government?

Also, remember how many shareholders screamed obsenities when TTP went into Australia? Australia's AGH has done rather well for shareholders, hasn't it?

[bermuda]

Hopefully IP got permission for the CAH purchase.I think it is an important issue.,otherwise why have an OIC.The other point of course is the price and whilst that may be outside the OIC brief it urks me.The Jack's Point purchase by SEA and not TTP also urks me.I can see a few issues coming out of the woodwork regarding SEA's offer at this insulting price.

[Noddy]

You have to wonder why the bid was announced so that it coincides with the May AGM. I wonder if Don Fletcher will be announcing some major risky purchase or direction inorder to scare minorities into accepting just before the bid closes (of course this would be another abuse of his position as a TTP director).

As for TTP's net debt, TTP is curretly in a stronger capital position than it has ever been in the past. It would be quite conceivable for SEA to buy the company at 40c and then to fund the entire purchase from TTP's own cash reserves.

An on-market share buy back would be the best use of TTP's cash and I hope someone brings this up at the AGM.

[Nightmare]

Bermuda, IP had OIC approval to purchase Carter Holt at $3.80 per share at that time. The point is that the OIC is there to make sure that any purchase is not prejudicial to NZ's interests. Hard to see how with half of NZ's commercial properties already owne by overseas interests how the OIC should get too dark on this one.

Noddy, TTP has net debt after borrowings are taken into consideration - so how does SEA fund a takeover from cash? It's net debt that counts - not how much cash you have. On your argument, I can go to the bank and borrow $10 million, leave it in the bank and tell everyone I have cash of $10 million to do as I like.

[Unicorn]

Non-Current Assets = $390M

Current Borrowing = $285M
Borrowing @ 50% of Assets = $195M
Repayment to reach this level = $90M

Cash = $282M
less Bonds = $14M
less Repayment to 50% borrowing = $90M
'Free' Cash $178M

240M shares to be bought by SEA @ 40c = $96M

It appears that the buyback can easily be met from cash. In fact borrowing could reduce to about 28% of assets for SEA after a takeover on those terms. And if the Auckland properties for which the recent sale agreement was cancelled were to be sold on those terms, no borrowing would be required.

It is not just net debt Nightmare, it is net debt relative to what sustainable borrowing the business can cope with. Your argument appears to be that any business with debt can do nothing!

[belgarion]

Dorkmare, Your nievity is astounding. TTP holders should ignore this dork. :)

[Nightmare]

quote:Originally posted by Unicorn

Non-Current Assets = $390M

Current Borrowing = $285M
Borrowing @ 50% of Assets = $195M
Repayment to reach this level = $90M

Cash = $282M
less Bonds = $14M
less Repayment to 50% borrowing = $90M
'Free' Cash $178M

240M shares to be bought by SEA @ 40c = $96M

It appears that the buyback can easily be met from cash. In fact borrowing could reduce to about 28% of assets for SEA after a takeover on those terms. And if the Auckland properties for which the recent sale agreement was cancelled were to be sold on those terms, no borrowing would be required.

It is not just net debt Nightmare, it is net debt relative to what sustainable borrowing the business can cope with. Your argument appears to be that any business with debt can do nothing!



Unicorn, no argument that SEA can fund the takeover using debt (leveraging TTP's balance sheet). The point is that some posters keep on referring to the cash held by TTP as if TTP has no debt to service.

If you look at SEA's past dealings, they will not be increasing their offer - even GPG found them uncompromising.

So sell at the 42 cents on offer in the market, wait for the offer top lapse and the shares top fall back to 35 cents and buy back in. And the shares will fall back when TTP announces its first investment in China ...brrrrrrrrrrrrrrrrrr.

[Unicorn]

I do not agree with you on this Nightmare (although my conclusion is mere opinion rather than based on fact). I think SEA do need to get control before too long. I think the offer will be increased - it really depends on what the larger minority holders will settle for (holding out for anything near nta will definitely kill any deal).

The minorities have the numbers to force a series of EGM's, even without the GPG stake that was there last time). I believe they can effectively stall investment into China or at least make the Directors personally liable for entering China in advance of a vote on a pending resolution that would prevent that course of action.

Failure to come up with a reasonable offer leaves the company open to action by minorities that would hinder future business. I think this is quite a likely course of action unless SEA take a more realistic point of view. If minorities see the share price fall back when the SEA offer lapses, then they would need to take action to protect their investment - the alternative is to allow SEA to slowly stangle them over many years.

[Andrew]

I feel also that once the independant appraisal comes out that they will have to increase the offer. For a property company taking over at less than NTA is unheard off. We have no issues of Goodwill or intangible assets.

If they wittle down the minorities out there, the additional cost to come up to 50cents will not be that great.

I am going to hang out till the bitter end and then go to arbitration as a final stand.

[Noddy]

Well I'll be joining you on that one Andrew. Unfortunatly after holding for over 5 years even NTA will not see a break even position.

See that independent directors have come out with an announcement today stating NTA 63c etc. Interesting point is what happens if say they get to 80% an then the minorities won't budge. SEA really needs 100%. Whilst they can consolidate TTP at the 51% level they can not intergrate TTP's cash and other assets until they have 100%. A very similar position to Mainfreight where they were frustrated at the last minute in their bid for Owens gaining just under 90%.

[cruisader]

this thing is headed for a stalemate. The independent report will obviously say the offer is unfair - NTA is 63 based on book value, and we all know property has had a lift. There are also Tax losses to value, so the final value could be well over 70cps. But if SEA wont budge it is all academic. They could creep for another five years. Why doesnt someone bid SEA 45c for their shares and see what happens. The OIC wont be concerned with fairness, they will only oppose it if they believe it is not in the "national interest".

[Noddy]

Don't think there will be a stalemate. SEA's offer will not be conditional on 90% or 100%. They will settle for whatever they can get at 40c then go back to the 5% creep. Problem for them is that in this way they keep taking out the weak sellers and keep pushing the price higher.

Those that hold out will get nearer to NTA. SEA need to consider whether for them a bid at a "fair price" getting control now is preferable to further delays and having to pay more to say 10-15% of shareholders some time down the track.

[Nightmare]

Notice today that some of the shareholders (presumably those who bought anytime in the last 4 years) are taking their profits at 42 cents.

SEA cannot and will not increase their offer - so next step is property development and investment in property red-hot speculative high China. Minorities cannot outvote SEA so watch the share price tumble below 35 cents when that happens.

Brrrrrrrrrrrrrrrrrr[xx(]

[Noddy]

Nightmare. I don't think this sort of comment is in any way constructive.

You are correct minorities can not outvote SEA but at the same time SEA can not ignore the minorities and any destruction in value to TTP done by SEA will also effect SEA.

If traders are taking profits at 41 then I wonder who is buying at this level. If SEA truly will not increase their above bid above 40c (now or at a later stage)I wonder why some are prepared to pay 41-42c ? There will be further developments in this saga.

I would be very surprised if we see TTP price in the mid 30's again (as much as SEA would like to see it there).

P.S Are you a director of SEA ? (your comments suggest that perhaps you are).

[boring]

Nightmare's last post is actually valid comment, given this mornings annoucement:

The Directors of Trans Tasman Properties Limited ("TTP") have received a letter from SEA Holdings Limited ("SEA") stating that its subsidiary companySEA Holdings New Zealand Limited ("SEANZ") "...will not increase the offerprice above 40 cents per TTP share".

SEA is prob. in no hurry and may be happy to let the offer lapse. With nothin to drive the shareprice, it may very well just fall back to mid-30s in the short term. You may then be waiting for another year before anything happens, money tied up that could be put to better use. Ignore this possibility at your own detriment.

[Nightmare]

Noddy, just pointing out the facts in case you are all so blinded with righteousness you forget that even GPG gave up trying to get SEA to move to take out monorities or sell all the assets to distribute cash.

Why is it that you find it so hard to consider a contrary view without insinuating dark deeds?

TTP under SEA will invest in China - NZ has been a very unhappy place for them and they have lost more money in TTP than anyone else.

Question is how many NZ shareholders have the stomach for China?

Who's buying? A few investors with more money than sense. There's better places to deploy your funds in the next 12 months than hope for SEA to increase its offer - try Tower for example.

[Burgerbun]

Obviously you havent DOUBLED your money buying this stock 2 years ago Nightmare. Check the threads to see who has bozo.

All very well now but where was Sniper and Matrix before TTP did the TON.



thats right NOWHERE.

just like you now...with NO TTP stock.

night nighty dorkmare

[Andrew]

Anybody going to the AGM wanting some proxies to create a stir.

[Noddy]

Note that the AGM is now the 14th. With the change of date I might be able to make it.

SEA offer should now be in the post. Given Ross Investments offer's I hope most holders now know to check the market price and will not accept.

[k1w1]

TTP offer rejected by Ferrier Hodgson as unfair given net asset value between 50 and 57 cents. Where to from here ?

[Oracle]

k1W1

They did not say nav was 50..57. They said that was their valuation for sale purposes. ie Nav discounted. my understanding.

From here there may be more bluff from SEA. However I believe their greed will make them increase the offer to 53 cents. They want it all, I guess. Discount 10 cents per share, tax credits, cash, good portfolio. Some of that portfolio, those Ak properties can probably be sold now, they will want all the benefit.

[zac]

Ann from NZX

TAKEOVER: TTP: TTP Takeover Offer Independent Report Conclusion Released

The independent directors of Trans Tasman Properties Limited (Trans Tasman),
Messrs John Ferner and Carl Peterson, have received from Ferrier Hodgson & Co
the requested independent adviser's report on the SEA Holdings New Zealand
Limited (SEANZ) takeover offer for all the shares in Trans Tasman SEANZ does
not already own.

The conclusion of the Ferrier Hodgson & Co report is:

"On the basis of our valuation range of 50 cps to 57 cps and our discussion
on the merits of the offer, we conclude that the offer by SEANZ for all of
the voting securities of Trans Tasman that it does not hold or control for 40
cents per share is neither fair nor reasonable."

The independent directors recommend that shareholders do not accept SEANZ's
offer.

[Noddy]

May earlier prediction of valuation 57c was not to far wide of the mark.

Interesting how over a million TTP traded today before the release of the report.

Next move I expect will be at the AGM. I will be attending (coming from Melbourne). For other holders please make the effort to attend.

[Oracle]

Noddy

I expect more moves before agm. I will be there, if nothing happens before then. Are you coming over just for agm?

THE KING says Noddy dont get to carried unless you have a very large amount of money in it you cant efford ot lose [ NO offence] But your wasting your time, I been to meetings before , Please bring a megaphone with you as NO one will will listen to you, and dont expect an angre mob to help you I could say more. But you will love the trip to NEW ZEALAND God Bless & bugger me. :D

Regards THE KING

[Oracle]

Noddy

Will you be wearing your blue hat with the bell on top?

[k1w1]

Oracle, agree with your point about the price being the valuation not the net asset value.

Noddy, I noticed the volume and price increase prior to the announcement. Thats what made me think that an announcement was due shortly. Nothing ever seems to be done about it as it must be too hard to prove but it is disappointing for ordinary mug punters like me.

Once the announcement was made the market seemed caught in two minds. Firstly there was the sell outs at 42c worried like Nightmare that the price would collapse as the offer would not be increased. Then later some optimists who saw the valuation as forcing an increased offer as a result of collapsing the earlier one.

Will be interesting to watch tomorrow which way the heavy hitters with the inside info go on this.

[bermuda]

I will be attending and I expect SEA offer will be raised to at least 50 cents prior to the meeting.Otherwise we could have a riot.

[Contrarian]

Gidday
I think they will get some, with an exemption from creep provisions+ they can get another 20% over the next 4 years.
Their last SSH notice came out 31.12.03 & advised of 58.115 to 59.972 seems closer to 2% than 1%. They cynically posted SSH when everyone was packed for holiday & a whisker under 60%.
SEA have displayed patience before, why change?

[Andrew]

SEA is very patient. Also they will not want to lose "face" (credibility) by increasing the offer.

After all minority shareholders are free money. No dividend is being paid. Income is still coming from the properties, and they are increasing in value all the time.

I see the offer period closing without an increase in the offer. In about eight months time another offer coming up to clean up the residue.

Price may come back down to 35 cent within two months. I am waiting to buy some more.

[bermuda]

Methinks they will up their offer to get 100% of all the cash that TTP is now generating.They will need this to finance their many other projects including Jack's Point.

[clearasmud]

Agree with Andrew.Love to buy some more at 35:D

[Noddy]

quote:Originally posted by Oracle

Noddy

I expect more moves before agm. I will be there, if nothing happens before then. Are you coming over just for agm?


Had to go to NZ in any event. TTP meeting just set the date for me.

One point that is not being raised on this forum is that whilst minority shareholders are not getting a dividend neither is SEA. They would love to get their hands on the cash but can't until they get 100% control. As they acquire more shares it requires more funding from them with the assets (shares) acquired generating no cash. See the note in the offer document saying that should SEA get 100% they will have to use TTP's cash. What this means is that the nearer SEA get to 100% the more desperate they will be to get TTP's cash or see TTP paying a dividend.Thus those shareholders which hold out will get the best deal in the end.

If the present offer is not increased I am sure we will see another offer before too long.

[Oracle]

They will increase the offer. They want it. It will never be cheaper.
Why share future profits. $Nz down. They will be able to creep very little from here. Larger holders will sit tight.

Iff they take out enough small share holders The NZX will demand it be delisted. Then where are you. Like CDL offer for KIN take it or leave it and have no market for your shares.

[Noddy]

quote:Originally posted by ENIGMA

Iff they take out enough small share holders The NZX will demand it be delisted. Then where are you. Like CDL offer for KIN take it or leave it and have no market for your shares.


With 3,000+ shareholders I don't think there is much risk of it being delisted. Look at Owens only around 12% of shares left in public hands and its still listed. Actually I would love TTP to get to the point where a listing was no longer available by that time all the sellers at 45, 50,55 would be gone and remaining holders could get close to fair value.

[Oracle]

Are SEA or associates about to weaken share price again. ..to buy more cheap ones. I noted yesterday at 2pm, a buy order for 1,000,000 at .40, in the depth, was withdrawn. Now an undisclosed seller has appeared at .42!

[Andrew]

If i was 99% sure this was to happen I would sell now and buy later at 35 cents. But I am only 50% sure that the SEA offer will lapse and not be increased till after later in the year.

But we should be certain that there will be much more volatility over the next 12 months.

[Noddy]

More details of the independent valuation and directors responce are out today.

Of interest are the alternative suggestions put by the independent directors to SEA (my hat off to them for actually making the suggestions). Of course SEA's responce is negative. Of interest is also the fact that they spoke to both Fletcher & Lui and that the responce is not reported to shareholders (read between the line's on this one).

Conclusion of the independent valuation is:

Ferrier Hodgson concluded its report by stating that: "Regardless of the level of acceptances of this offer and the future potential restructuring of Trans Tasman from an investment and taxation perspective, we believe it likely, based on our commercial experience, that SEANZ/SEA Holdings will at some stage seek to acquire all the shares of TransTasman.

[Noddy]

I wonder how many other properties they/we have that would sell above book value. Maybe NTA of 63c is on the low side.

ASSET: TTP: Conditional Agreement on Sale of Auckland Property Trans Tasman Properties Limited ("TTP") announces that its subsidiary, NZGP(810 Great South Road) Limited, has entered into a conditional contract withMacquarie Goodman Nominee (NZ) Limited ("Macquarie Goodman"), acting asnominee and trustee for the Macquarie Goodman Property Trust and theMacquarie Goodman Industrial Trust, for the sale of the Fletcher Complex inPenrose, Auckland. The contract price is a cash offer of $72 million and is above the company'scarrying book value. The contract for sale is subject to the following conditions: 1. approval from the Overseas Investment commission;2. waiver of the first right of refusal in favour of Auckland Universityof Technology; and3. waiver of the first right of refusal in favour of Fletcher BuildingLimited. Should either of the rights of first refusal be exercised, settlement mustoccur on the same conditions as agreed between TTP and Macquarie Goodman. The conditions must be satisfied by late June 2004 for the agreement tobecome unconditional, with settlement expected to occur shortly thereafter.

[astro]

The latest property sale will result in another 12 cents per share of asset backing being represented by cash rather than property. It is further confirmation that the SEA takeover offer is too low. I don't expect SEA will get many acceptances and when the offer lapses the company itself should use some of its cash to instigate a share buyback. It would be hard for the board to find a better investment than buying 63 cents of assets for 40 to 45 cents. For that reason I don't see much downside in rejecting the offer.

[Noddy]

Went to the AGM. There were a few hundred there plus Bruce Shepherd from the NZ Shareholders Association who delivered a good address. As expected Jessie Lu was not in attendance.

Don Fletcher told us that there were more property sales in the pipeline and at least one was expected to sell well over book value (a block of land I think).

I raised the issue of Jacks Point and corporate opportunities. Don Fletcher stated that it was covered in his employment contract. In the end we had to agree to disagree with Don saying we should not need to talk about legal opinions (although I noted that TTP's/SEA's lawyers Chapman Tripp were in attendance.)

The issue of dividends and a share buy back were raised. There was an undertaking that dividends would be seriously considered next year and that a share buy back would be discussed at the next board meeting.

My last question was to ask Don Fletcher that given TTP's NTA and future prospects whether he would accept SEA's 40c offer if he were a shareholder. His reply was ".......No....I guess Jessie wouldn't like me saying that".

I think a few shareholders expected an announcement of an increase in the SEA bid price at the meeting. That was not my expectation however.

Overall I came away from the meeting feeling that market value NTA is higher than 63c. If the price falls below say 38c after the 20 May I think TTP would be good buying with limited downside from there.

Anyone else at the meeting wish to comment?

[Andrew]

I wasn't there but realistically knew how it would be. All very nice and polite, just wanting to get the formality over with, with underlying tones of if this last offer isnt going to work how can we get their shares at less than NTA in another way. (Being careful about my actual words in this instance)

However knowledge is power. Not much power in this case but a little.

[bermuda]

I was there and found it very entertaining particularly when Bruce Sheppard called Mr Fletcher and Mr Hodge "Turkeys".Which he was forced to retract.Notwithstanding this banter the meeting obviously were highly disappointed in Mr Fletcher's 'part-time performance'and with the unfair offer from SEA at 40 cents.At one stage the audience almost had Mr Fletcher calling for a show of hands as to who would support a buyback at 50 cents....until he realised it would not be in TTP's interest to entertain such an offer(since they can buy them on the market for far less.!!)
I did ask about their offshore policy now that the $ had fallen and was advised that they would rethink their exposure.What I should have asked was why the Independent Directors saw fit not to get involved in Jack's Point whereas SEA took 60% and Fletcher 15%...but I think we might get the answer to this at a later date...
Another interesting point raised was that with the further sale of properties under contract,the cash on hand would climb to over 40 odd cents per share.and a capital repayment could be warranted.
Fletcher/The Board came in for some severe criticism regarding the large management contract payouts and for the continued empty non revenue earning Auckland Club Building.
But now that the meeting's over all we have is Fletcher's confirmation that the company is worth more than 40 ents and that they will be looking at a buyback sometime in the future.

[Noddy]

Shareholder notice issued today by SEA.

The 40c offer got them only 7.4M shares taking their holding from 59.92% to 61.21%. If we took 50c as fair value (the lower end of the valuation) then they have picked up $740,000 of value at no cost. But then they must pay TTP's expenses and their own.

All up the exercise was probably a waste of time and effort for them. I'm very pleased to see the majority of shareholders did not accept. Hopefully this is the only shareholder notice they will be posting. SEA will have to do much better than 40c next time around.

[Andrew]

Some deranged people happy to give money away to Asian investors.

[k1w1]

TTP now has even more cash. I don't know how to reprint the link but someone who does can go to a listed Australian property trust called Record Realty Trust (RRT) in which Tasman Properties, a subsidiary, was a substantial holder and has now sold out its shareholding.

Unfortunately this is just before RRT is going to do a distribution based on a 40% return on a property investment it has realised and also a refinancing return on a lease extension. Dumb.

[boring]

What do you shareholders out there think of this deal:

http://www.nzherald.co.nz/business/businessstorydisplay.cfm?storyID=3574652&thesection=business&thesubsection=commproperty&thesecondsubsection=general&thetickercode=TTP

The development timeframe will take a long time to unlock or realise any value out this project, probably not helping the cause of shareholders looking to exit this stock. Don Fletcher is looking more and more like a puppet, is he acting in the best interests of his NZ shareholders ? Doubtful.

Who knows, long term the investment in HK property could be fruitful. If I was a shareholder, I'd probably perfer them in invest in property in the special economic zones in China (eg Shenzen) if possible, rather than HK.

[Andrew]

I dont object to purchasing property in Hong Kong, however as long as there is no transfer of value from TTP minority shareholders to SEA Holdings. A little hard to keep track of what is going on in HK as regards, quid pro quo with Jesse' Mates. May be he should change his name to James. Don Fletcher konows his days are numbered and he will do anything he can to get as much as possible before, and cosy up to SEA until he is, finally let go.

Still holding on with a few shares. Not as many as I had before.

[Oracle]

I don't have a problem with the investment. I believe that the timing reinforces the likelihood of a buyback soon...perhaps to 45 cents. More building sales are close? Still enough cash.

Still hold some.

[Benlamnz]

Don't hold any TTP. but I read that Hong Kong is coming back strongly from a recession, and the recent land sale in the region fetched over 70% from reserve prices. May turn out to be the most profitable deal ever for TTP.

Mean while TTP's not alone. BRY shareholders also subject to the "don't know what da ****'s going on " syndrome.

[Oracle]

Is SEA up to tricks again to depress TTP price? Influx of substantial new sellers, undisclosed.

Would you tell the world that you had a lot to sell, or drip them on to the market. These would be large shareholders who you would think, had made the decision to stay!

I reckon all the "sellers" are Chinamen.

[Andrew]

Had some thoughts, that the more technical amongst you may be able to help.

"Major" transactions require a special resolution of 75% of shareholders. Major transactions are those that involve more than 50% of assets of a company. Does anyone have any ideas whether that is Net assets, Net tangible assets, Fixed assets, gross assets or shareholder asset backing.

I believe that SEA would invest in property in Hong Kong on a piecemeal basis so that they then would not need a special resolution, whereby dissenting shareholders can trigger a buyout. However their announcement that they would invest overseas would I believe be a major transaction if they purchased an accumulation of properties overseas, thus requiring a special resolution on a particular policy rather than each individual purchase.

Worth pursuing what do you think?

[blackcap]

quote:Originally posted by Andrew

Had some thoughts, that the more technical amongst you may be able to help.

"Major" transactions require a special resolution of 75% of shareholders. Major transactions are those that involve more than 50% of assets of a company. Does anyone have any ideas whether that is Net assets, Net tangible assets, Fixed assets, gross assets or shareholder asset backing.

I believe that SEA would invest in property in Hong Kong on a piecemeal basis so that they then would not need a special resolution, whereby dissenting shareholders can trigger a buyout. However their announcement that they would invest overseas would I believe be a major transaction if they purchased an accumulation of properties overseas, thus requiring a special resolution on a particular policy rather than each individual purchase.

Worth pursuing what do you think?


Gidday Andrew, I think you will find that it is Total Assets, ie non current assets plus current assets, or so once a learned man told me. Hope that helps.

[biker]

TTP are currently trading at about a 40% discount to net asset backing of 64.2 cents, 47 cents of which is cash. At current prices around 37/38 cents surely the downside is fairly limited and with a buy out of minorities at say 55 cents (still about 15% below asset backing) costing SEA less than $130 million, surely given time they will end up taking the lot and delisting.
Several recent deals by TTP buying, selling,and developing seem to me to have been quite smart and board/management certainly seem to be active,and not just sitting and skimming.
I'm only looking at TTP as they are now and I have no baggage from the past.
In a nutshell, I'm buying with a 2 year view of good capital gain.

[bermuda]

Biker,If you have the patience of 2 years then TTP is a standout.I went to the AGM and Don Fletcher 'promised' a share buy back in the not too distance future.The asset backing is rising as we speak.

THE KING says if you hang around long enough you will hear a replay of all the OLD story`s with nothing new to say but the OLD story thoughts , my trouble is I am running out of time [OLD AGE] my cure is:- Lets bring back Sir Robert and give him another run it would not HURT.. :D:D

Watching from Australia THE KING

[foodee]

Bermuda
Could see that one coming. Share buy back on market-using 'your capital.'
Major share holder thereby increasing ratio of control without having to pay up!![V]

[bermuda]

Foodee,
I think they can start buying again in October,another 5% as per stock exchange rules that is.

[Oracle]

No, 20 May next year. Refer Takeover response document, page 40.