HBY Chart

[macduffy]

Thanks for the link, winner. Nothing new there but worth the listen!

:)

[noodles]

Did anybody go to the AGM? Any highlights?

[macduffy]

The market has reacted well to HBY's announcement increasing the dividend payout ratio from 50% of NPAT to75%. SP up 14c in a fairly flat day.

:)

[bunter]

HBY had a 50/200 MA cross (on dividend-adjusted prices) at $2.92, in Oct 2014.
The price has gone up after a good result, and an announcement that they're paying 75% of NPAT as dividends.
This shouldn't really matter, but for many investors, and my quirky valuation system, it does - system valuation now $5.16

After 'meaning to' ever since $2.90, I bought some today at 3.28, paying the asking price - and immediately the quotes went to 328 / 345.

6588

[macduffy]

Hi, bunter.

Ref your post on companies with prospects of paying 10% yields.

I hold and favour HBY but am wondering what effect the downturn in oil prices and oil company fortunes might have on business for their subsidiary Contract Resources. Nothing apparent at this stage but ......

Any thoughts?

[bunter]

Don't know. Contract resources is about a quarter of the group turnover and profit.

[winner69]

Great result

Belg will be rapt ...and becoming a lot richer

What happened to Belg .... He was a valuable poster

[macduffy]

Yes, a very good result and a pleasant surprise although the market had clearly been expecting good things.

I was particularly pleased to see the positive comments about Contract Resources' business which previously was looking a bit vulnerable to the oil and gas downturn.

[macduffy]

Another good result from Hellabys. That Oil and Gas Services division continues to defy its environment and goes from strength to strength.

Holding for now.

http://www.hellabyholdings.co.nz/News_Archives.php?id=189

[macduffy]

Another good result from Hellabys. That Oil and Gas Services division continues to defy its environment and goes from strength to strength.

Holding for now.

http://www.hellabyholdings.co.nz/News_Archives.php?id=189

[cloggs]

Pleased with the result. I was going to buy more at this price but reminded myself the price has been going down, and only down. Bit annoying because they seem to be making money.

[winner69]

HBY price been cycling between 280 odd and 340 odd for the last 3 years.

Look at the 50MA line on the chart to see what I mean. It's starting to head up at the moment so 340 again is quite likely.

Did you notice the Death Cross a while ago?

Like what thy do as an investment company. If anything a reasonably safe bet at these kevels.

[Jaa]

The market seems to like the new guy, Alan Clarke who was the CEO and Managing Director at Abano. Any thoughts?

[nextbigthing]

a) ex divvy this week, buyers getting in
b) new ceo as you state
c) flagged the sale of underperforming shoe division
d) possible acquisitions
e) some smart articles and comments in the NBR by some clever people :D

[Jaa]

Mr Clarke just paid $3.23 for 100k shares, two months before he even starts. I am liking him already!

[winner69]

Hmm ....things not that rosy maybe?
https://www.nzx.com/files/attachments/226012.pdf

When Hellaby say economic and market conditions are 'variable' now that's are pretty good signal that next year won't be much better.

Be interesting to see what market response is - HBY had no surprises for a while

[winner69]

Mr Clarke just paid $3.23 for 100k shares, two months before he even starts. I am liking him already!

He be hoping his new strategic plan works then to get back to square 1

[winner69]

Just as the chart was looking promising it starts heading back to where it was 3 years ago

[mshierlaw]

How could they have got the earnings forecast so wrong:confused:

Just as the chart was looking promising it starts heading back to where it was 3 years ago

[BlackPeter]

Anybody still around on this thread? The half year results are here:

https://www.nzx.com/companies/HBY/announcements/277907

In a nutshell: revenue down (as expected), but at the upper end of guidance and expect to make up for the dent in the second half;

Contract Resources down, but expect a bumper second half (refineries can delay maintenance only for that long and are now shutting down with lower refining margins)

Automotives and construction resources: good growth and result;

Shoeware ... soft, as expected - and they try to sell as non core business

Overall: result does not feel overwhelming, but I think that the company (or should I say fund) appears now fairly valued and most of their business is essential for the industry - i.e. growth potential. Much more logical combination than in the good old times when they owned the BBQ factory.

Discl: I bought a small parcel prior to the announcement - and market seems to like the announcement, which makes me happy as well ;)

[see weed]

Nice little div tomorrow.

[trader_jackson]

HBY beginning to looking like good value in this market, seems to have missed out on the general increase many NZX stocks have experience in past few weeks/months... looks even better given its current double digit gross dividend...

Would be much appreciated to hear other people's thoughts on this stock...

[BlackPeter]

HBY beginning to looking like good value in this market, seems to have missed out on the general increase many NZX stocks have experience in past few weeks/months... looks even better given its current double digit gross dividend...

Would be much appreciated to hear other people's thoughts on this stock...

Obviously - they had a not so flash first half year result ... but expect the second half to be quite good - their specialist cleaning services for refineries expects actually a bumper result, given that refineries can delay maintenance only that long without risking very expensive unplanned shut downs (or worse).

Most of their current holdings (not sure about the shoe business, though) look quite promising ... I do see them as good value at current SP and bought recently a small parcel.

[BeeBop]

HBY beginning to looking like good value in this market, seems to have missed out on the general increase many NZX stocks have experience in past few weeks/months... looks even better given its current double digit gross dividend...

Would be much appreciated to hear other people's thoughts on this stock...

I purchased also, thought they have a few streams of revenue...was concerned about the contracting aspect due to the oil issues in the M.E but see that it is bigger than just that. Metrics all checked out for me with a good CCVI. Reports were clear and I liked their plans especially the automotive division. Key basic metrics which got me looking further were: low P.E, low P.S, Good DY, debt not too high.

[mshierlaw]

HBY beginning to looking like good value in this market, seems to have missed out on the general increase many NZX stocks have experience in past few weeks/months... looks even better given its current double digit gross dividend...

Would be much appreciated to hear other people's thoughts on this stock...

Bought August last year based on a solid anual report. Then they revised earnings forecast downwards when new CEO started. Still holding & thanks to dividends have not lost any $$$$. Not a lot of confidence here for me, waiting for end of year results to determine next steps.

[macduffy]

HBY is "on probation" in my portfolio too. I'm not entirely reassured by statements about the recent acquisition, Contract Resources, so will be wanting to see some solid evidence that this is paying its way - and not just promising to do so. Otherwise, we might have to part company.

[winner69]

Must be frustrating as following Hellaby. They seduce me to the point of being very interested than they seem to unndertake strategic reviews and all that sort of stuff.

Warm fuzzy stuff in todays announcement until near the end - bad news in a few weeks time methinks.

The near the end bit -

.
Challenging Trading Conditions Update

Market and economic conditions continue to be variable across all of Hellaby’s major Resource Services markets. In particular, the ongoing oil price and production volatility continues to impact on refinery maintenance schedules.

Alan said: “The expected second half contract work has not eventuated at the levels estimated prior to Christmas as a number of our Australian and Middle East customers have again pushed out scheduled maintenance work even further.

“We expect to have an update on trading conditions and to issue guidance ranges for the financial year in three weeks’ time, following completion of a detailed review that is currently underway.”

[Hoop]

For 12 months there has been lower highs and lower lows..shareprice hasn't fallen far ~20% so HBY is one of these cuddly guys at the moment 8029

[sb9]

Hey Hoop, that link comes up with error 404 not found.

By the way, good to see you back posting.

[Hoop]

Hey Hoop, that link comes up with error 404 not found.

By the way, good to see you back posting.
Thxs SB9...I think I've fixed the link problem..Anyway if not fixed no matter as its just a silly smiley bear face.. Market Boredom does that to me..

[BlackPeter]

Feels to me the market over reacted to the recent announcement. The only negative bit I've seen is that refineries further delayed their maintenance to make the most out of the currently huge margins. One thing is sure - they can't delay maintenance for ever ...

Otherwise ... adding another jewel into their automotive division looks like a plus to me; Reducing their corporate overhead looks positive as well - and the intention to get rid of their shoe business (though not unexpected) is in my view a plus as well.

Time to buy some more?

Discl: Holding;

[winner69]

Trading EBIT to be $28m v $45m.last year

Some drop

Suppose the future prospects is all about having faith in this new man and his new strategy ......and hoping like hell market conditions improve

[BlackPeter]

Hellaby buys TBS Group:

https://www.nzx.com/companies/HBY/announcements/284549

I guess if the assumptions are right (85 million revenue and 8 million EBIT), than the purchase price of 45 m + 6 m "earn out" appear not too bad - unless TBS carries a lot of debt on its balance sheet (which we don't know yet). Would be nice if they would have mentioned the expected net profit of the new division, who cares about EBIT anyway?

As well a new CEO for the Contract Resources. Just wondering whether this is coincidental. Given that the 2 companies appear pretty complementary, and given that they praise that TBS Group might smoothen the patchiness of Contract Resources workload, it might make sense to merge them at some stage - wouldn't it?

[BlackPeter]

Hellaby sells their equipment group for $81m to a private equity fund, booking a $30m profit.

https://www.anzsecurities.co.nz/DirectTrade/dynamic/announcement.aspx?id=4179620

Looks like the new CEO brings some movement into the business ... and intends to use the additional funds to focus more on their core business (automotive and resource services). Looks like a win-win to me.

Discl: holding;

[BlackPeter]

Oops - up this morning by 18 cents .... looks like Mr Market agrees :t_up:

[macduffy]

Seems like a "reflex" sale to me. The equipment business wasn't marked for sale and is arguably one of HBY's better performing but hey, we want to sell something and there's this too good to refuse offer! Would have preferred a sale of the Contract Resources business but they seem committed to that sector.

[BlackPeter]

Fair comment ... equipment was certainly one of their better performers, but than - this is the time to sell them to get a premium - isn't it? At the end of the day HBY is just another investment fund ... supposed to increase shareholder value.

Not sure yet about contract resources ... yes, looks like their customers are dragging their feet re maintenance, but not sure how long they can delay such things?

Anyway - market seems to be happy.

[Jaa]

They seem to have a clear vision of where they want to go. Automotive and oil & gas services. Maybe they will end up with just automotive?

You could argue that equipment sales have peaked with the Christchurch rebuild well underway and low dairy prices. They were moving this division's focus to servicing which seemed a good idea but it was still relatively small.

This transaction alone realises 31.5% of their market value yet only earned 20% of the group's EBITDA. HBY is definitely unloved and undervalued by the market.

[macduffy]

They seem to have a clear vision of where they want to go. Automotive and oil & gas services. Maybe they will end up with just automotive

Oil and gas services is a recently acquired business. They are unlikely to quit this, in fact have expressed interest in further acquisitions.

[Jaa]

Oil and gas services is a recently acquired business. They are unlikely to quit this, in fact have expressed interest in further acquisitions.

I know but after another year or two of missed earnings estimates and declining EBITDA I wouldn't be surprised!

Not that such things have caused them to cut their losses with the shoes yet!

[BlackPeter]

Small gem taken from the June 2016 IEA energy report (https://www.iea.org/oilmarketreport/omrpublic/):


Refinery runs in 2Q16 are suffering from deepening outages. Throughput is nearly flat year-on-year, as refiners finally catch up with maintenance postponed from 2015. The seasonal ramp-up to 3Q16 is expected to be the largest on record, surging by about 2.3 mb/d quarter-on-quarter.


I guess this fares well for contract resource services ... If not for the 2016 financial year (which just ended), but certainly for the new one!

[BlackPeter]

http://www.sharetrader.co.nz/showthread.php?9365-Dunedin&p=629415&viewfull=1#post629415

Wednesday, 27 July, 5.30pm, ToiTu Otago Settlers Museum;

This is a late afternoon event with information for share holders about the NZSA

http://www.nzshareholders.co.nz/file...go%20flyer.pdf

Presentations given by

Peter Mence (CEO, Argosy Property)
John Hawkins (National Chairman, NZSA) and
Alan Clarke (CEO, Hellaby Holdings Ltd)

If you live in or close to Dunedin (or just happen to be there) - why not pop by and talk with and listen to the CEO of Hellaby Holdings and the people for of the New Zealand Share Holder Association - they are an independent voice for retail shareholders (and for many retail investors the only voice they've got) at AGM's and around company boards!

Plan for roughly 90 minutes. Attendance is free. It would help however (for catering purposes) if you register in advance at http://www.nzshareholders.co.nz/

We hope to see you there ...

[BeeBop]

http://www.sharetrader.co.nz/showthread.php?9365-Dunedin&p=629415&viewfull=1#post629415

Wednesday, 27 July, 5.30pm, ToiTu Otago Settlers Museum;

This is a late afternoon event with information for share holders about the NZSA

http://www.nzshareholders.co.nz/file...go%20flyer.pdf

Presentations given by

Peter Mence (CEO, Argosy Property)
John Hawkins (National Chairman, NZSA) and
Alan Clarke (CEO, Hellaby Holdings Ltd)

If you live in or close to Dunedin (or just happen to be there) - why not pop by and talk with and listen to the CEO of Hellaby Holdings and the people for of the New Zealand Share Holder Association - they are an independent voice for retail shareholders (and for many retail investors the only voice they've got) at AGM's and around company boards!

Plan for roughly 90 minutes. Attendance is free. It would help however (for catering purposes) if you register in advance at http://www.nzshareholders.co.nz/

We hope to see you there ...

just registered interest....for once, I am in same country and same city so now I need to make the effort!

[BlackPeter]

Hope you enjoyed the show ;). Here is the presentation (well, the bit from Hellaby): https://www.nzx.com/files/attachments/240087.pdf

[BeeBop]

Hope you enjoyed the show ;). Here is the presentation (well, the bit from Hellaby): https://www.nzx.com/files/attachments/240087.pdf
I was impressed with the Hellaby presentation. A C came over very well and seemed to have his whole heart in the job. Argosy was same ole....he didn't impress me....didn't think he was bad either ... Just not same calibre....

[macduffy]

I was impressed with the Hellaby presentation. A C came over very well and seemed to have his whole heart in the job. Argosy was same ole....he didn't impress me....didn't think he was bad either ... Just not same calibre....

I've seen a lot of impressive presentations in the last 45+ years, not all live up to their aspirations. Meanwhile, though, I'm prepared to wait a while to see if the pudding's worth eating!

[BlackPeter]

Not a golden Cross yet, but the first time for nearly a year now that the SP is hovering above the MA200 - with reasonable trading volume.

I guess every trend change starts with a small number of positive indicators. Given the good impression the CEO made so far (leaner structure, better focus) am I optimistic;

Discl: holding;

DYOR;

[BlackPeter]

Annual Results are out: https://www.nzx.com/files/attachments/242129.pdf

Both Revenue as well as NPAT at the top end of guidance, though not a record year. Outlook positive. Annual dividend unchanged (21.5 cts per share).

Automotive doing well and growing. Resource services still profitable (and expected to catch up this year), Equipment profitable but slight decline (but sold anyway at a great price), Footwear ... well, at least they don't contribute a loss.

Balance sheet still sound (though liabilities increased - now 55% of total assets) and ROE (NPAT / share holders equity) dropped to (just) below 10%. They claim a better number - probably based on EBITDA or similar ... anyway, not outrageous, but o.k.

discl: quite content share holder ...

[BeeBop]

I too, am a happy holder... And am happy with the direction and the reporting.

[thedrunkfish]

Consistantly boring. :t_up: from me. Now if only they could ditch the shoes....

[mondograss]

I'm amazed someone like Briscoes group haven't come after the shoes. I mean Hannahs and Number 1 Shoes would seem to fit nicely into their stable.

[macduffy]

I'm amazed someone like Briscoes group haven't come after the shoes. I mean Hannahs and Number 1 Shoes would seem to fit nicely into their stable.

ROIC of 4% isn't enough to entice Rod Duke, particularly when it's a business that's shown little growth, operating from expensive leased mall and high street premises. Hard to see who it might appeal to which is probably why it hasn't sold.

[mshierlaw]

Consistantly boring. :t_up: from me. Now if only they could ditch the shoes....

I heard on RNZ business new tonight that a sale announcement for 'the shoes' was expected today. Alas it did not eventuate. Waiting ..... waiting ...... waiting.

[BlackPeter]

I heard on RNZ business new tonight that a sale announcement for 'the shoes' was expected today. Alas it did not eventuate. Waiting ..... waiting ...... waiting.

Here is the shoe announcement: https://www.nzx.com/files/attachments/242372.pdf

However, not a sale, but a shoe task force - looks like they want to make the sector more attractive (to sell it later).

Not sure, whether it is worth the additional management time, but on the other hand - if I look at their current shoe business (e.g. Hannahs or No 1 shoes) - the shops look so tired that it can't be hard to freshen them up. Lets hope it pays.

[winner69]

Here is the shoe announcement: https://www.nzx.com/files/attachments/242372.pdf

However, not a sale, but a shoe task force - looks like they want to make the sector more attractive (to sell it later).

Not sure, whether it is worth the additional management time, but on the other hand - if I look at their current shoe business (e.g. Hannahs or No 1 shoes) - the shops look so tired that it can't be hard to freshen them up. Lets hope it pays.

Possible demerger in the future

Don't have many of those on the NZX

[BlackPeter]

Possible demerger in the future

Don't have many of those on the NZX

Demerger - maybe? Though I'd think it would be more likely that they just want to give the shoe business some shine to make it more attractive for a potential suitor.

Not sure whether I would want to buy or own shares in a (currently) rather lame stand alone shoe business. However - the shoe business and the shop locations might offer quite interesting synergies for some other retailers like Warehouse, Briscoes/Rebel Sport, Farmers ...

On the other hand, there are some more interesting shoe shops (think Athlete's foot) around, but I am not sure whether NZ is big enough to accommodate some more of them.

I am sure we'll see in due course and I probably don't lose sleep over it until than ...

[mondograss]

Athletes Foot kind of stores are fine for the specialty sport stuff, but Hannahs, Hush Puppies and No1 Shoes are more of a bulk\continuous discounter format that fits closer to how Briscoes operates. I'm sure they get heavily squeezed by The Warehouse. You often see them close to a Briscoes or a Rebel Sport in a strip mall arrangement, so yes I think you could see some synergies there. Maybe Farmers would take over Hush Puppies to bring them in-store (fits with their brand, though it's been a while since they've offered much range in footwear) and Briscoes Group takes Hannahs & No1 Shoes?

[winner69]

Athletes Foot kind of stores are fine for the specialty sport stuff, but Hannahs, Hush Puppies and No1 Shoes are more of a bulk\continuous discounter format that fits closer to how Briscoes operates. I'm sure they get heavily squeezed by The Warehouse. You often see them close to a Briscoes or a Rebel Sport in a strip mall arrangement, so yes I think you could see some synergies there. Maybe Farmers would take over Hush Puppies to bring them in-store (fits with their brand, though it's been a while since they've offered much range in footwear) and Briscoes Group takes Hannahs & No1 Shoes?

Rod Dukes first job wascselling shoes

Cant really see Briscoes/Rebel wanting own a chain of shoe shops myself, even if they have 25% market share

Nobody found them attractive yet says a lot

[BlackPeter]

Shoes or not ... we just passed the golden cross and SP rising ... love it :t_up:!

[winner69]

Shoes or not ... we just passed the golden cross and SP rising ... love it :t_up:!

It has too

Hope this times it's different - could even get back to $7 again

This was Belg's favourite - anybody know what happened to Belg? He was a good guy

[percy]

It has too

Hope this times it's different - could even get back to $7 again

This was Belg's favourite - anybody know what happened to Belg? He was a good guy

Unfortunately another who disagreed with the moderators.
Far too much knowledge has been lost.

[mshierlaw]

Not really my style but sold out today CD. I expect a big hit to share price XD with 2 of the 4 divisions significantly under performing. Still ... made a net 7.3% for 13 months holding.

[BlackPeter]

Not really my style but sold out today CD. I expect a big hit to share price XD with 2 of the 4 divisions significantly under performing. Still ... made a net 7.3% for 13 months holding.

Interesting statement ... markets are typically forwards looking, and last years problems of the contract resources division are well known and priced in. The other division not performing that flash is shoes ... hardly material to their results.

So, just help us to understand, why do you think the SP will tank at XD? Obviously it is likely it will drop by the value of the dividend (plus minus some jitter) - but otherwise ... is there anything you know about the underperforming divisions the market does not yet know but will learn at XD?

Discl: quite happy holder;

[littletramp]

Looks like the new boss is getting things organised. Sold off the rubbish, ring fenced the under performer and is now cashed up, ready to stick to the knitting and focused on growth. Volume picked up and someone has been "cleverly" acquiring since mid August?

[mondograss]

Well looks like another one about to head overseas. This time to the Aussies.
https://www.anzsecurities.co.nz/DirectTrade/dynamic/announcement.aspx?id=4252327

[winner69]

Looks like the new boss is getting things organised. Sold off the rubbish, ring fenced the under performer and is now cashed up, ready to stick to the knitting and focused on growth. Volume picked up and someone has been "cleverly" acquiring since mid August?

Takeover at $3.30 Bapcorp BAP.ASX

Some 30% of shares already 'locked up'

I sense you guys will expect heaps more

But least they started low to get this 'under-performing' company

[mondograss]

I think the pick up in volume and price lately has just been around the dividend, which was quite healthy. But yes I think they could be getting this a little bit on the cheap side.

[see weed]

Buga. Just goes to show dividend stripping doesn't always pay off. Bought 25,000 at av $2.70c in mid march,collected div and sold out at end of April for av $2.782c and pocketed $3963 including div.:eek2: Boo hoo hoo.

[BlackPeter]

100% for $3.30. Feels a bit light, particularly considering that the offer document is running down the business. Never trust a buyer who wants to urge you to sell something by emphasising the flaws of the merchandise ...

"HELLABY’S NEW STRATEGIC DIRECTION IS UNPROVEN AND HAS RISKS"

Really? Just wondering why they make an offer if they don't believe in the new strategy?

Anyway - there will be plenty of time to consider (and opportunities for the markets to push the price up). I won't sell my shares in a hurry.

[mondograss]

Buga. Just goes to show dividend stripping doesn't always pay off. Bought 25,000 at av $2.70c in mid march,collected div and sold out at end of April for av $2.782c and pocketed $3963 including div.:eek2: Boo hoo hoo.

My heart bleeds for you, really it does.

[mondograss]

It's interesting that they've managed to sew up the big shareholders so quickly, but of course we don't know how much they got. But yes I'll be waiting and seeing on this one. No need to rush into it.

[littletramp]

Regards big shareholders, the 26m odd shares of Castle Investments may be the executors/trustees of a very complex estate preferring a bundle of cash to having an interest in a conglomerate of businesses? They may have been an easy sell even at market prices to divest a holding of that size in the circumstances?

[traineeinvestor]

First reaction is that $3.30 is far to low given the underlying fundamentals, the turn around happening in the mining sector at the moment and the dividend yield. I am very surprised that any shareholder pre-committed to accepting the offer at this price.

Currently trading at $3.29. If the share price drops to around $3.25 I would be tempted to buy more on market in expectation of a more realistic offer being made??

Bigger problem: I already have too much cash on hand and it's difficult to find good value shares at the moment which offer a similar yield to HBY.

[winner69]

Regards big shareholders, the 26m odd shares of Castle Investments may be the executors/trustees of a very complex estate preferring a bundle of cash to having an interest in a conglomerate of businesses? They may have been an easy sell even at market prices to divest a holding of that size in the circumstances?

I think this Castle Investments is connected to the late Hugh Green and his investment company. he was once Chairman

and interesting going ons in the Courts as well

[percy]

100% for $3.30. Feels a bit light, particularly considering that the offer document is running down the business. Never trust a buyer who wants to urge you to sell something by emphasising the flaws of the merchandise ...

"HELLABY’S NEW STRATEGIC DIRECTION IS UNPROVEN AND HAS RISKS"

Really? Just wondering why they make an offer if they don't believe in the new strategy?

Anyway - there will be plenty of time to consider (and opportunities for the markets to push the price up). I won't sell my shares in a hurry.
Yes looks a bit too light.
With the sale of the equipment business HBY's debt has been reduced.
Perhaps the directors should announce a "special" dividend which may sweeten the deal some what?

[mondograss]

Wouldn't a take over offer normally be accompanied by something from the board either recommending it or not?

[BlackPeter]

Wouldn't a take over offer normally be accompanied by something from the board either recommending it or not?

Not accompanied, but followed ... Expect over the next couple of days a statement from our board asking everybody to stay calm and announcing an independent report and recommendation ...

[mondograss]

Sounds like the board aren't keen on the offer:
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11718503

Interesting to read such statements though when there's been no release to the market from the board. You'd think they'd at least put something out saying that they are working on providing guidance.

[BlackPeter]

Sounds like the board aren't keen on the offer:
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11718503

Interesting to read such statements though when there's been no release to the market from the board. You'd think they'd at least put something out saying that they are working on providing guidance.

to be fair ... there was yesterday a brief statement from the company: https://www.nzx.com/companies/HBY/announcements/289830


The Hellaby Board is not in a position to comment further at this stage. The Hellaby Board will meet shortly to consider the takeover notice and draft offer in detail. It will also immediately proceed with the appointment of an independent adviser and fulfilment of its other obligations under the Takeovers Code.

The Board of Hellaby strongly recommends that Hellaby shareholders do not take any action in respect of the notice of intention to make a takeover offer until they receive the Board’s further guidance. Shareholders who are considering selling their shares before then are recommended to seek their own professional advice.

Came out around lunch, but I missed that as well under the flood of other announcements.

I guess fair enough ... I assume the takeover proposal was a surprise for them as well, and obviously the board needs to meet before it can make announcements.

[mondograss]

Ah yes, there it is, it was a bit buried wasn't it.

[macduffy]

BAP's offer prompted me to take another look at that company which has been on my watchlist for a while. One of the best performed Aussies recently and therefore always "expensive". Liked what I saw and bought a few yesterday. A sort of a hedge if they buy me out of HBY?

[winner69]

Grant Thornton will do their usual good job and i reckon come up with a $3.47 to $3.69 range

See HBY management playing the old 'no premium for full control' trick - that's a sin of desperation.

Guy from Bapcorp was on radio this morning. Said they had been talking with HBY about buying the parts business but they weren't that keen so the whole lot it is to be .....and then hock off the bits they don't want (shoes included ha ha) .....and hey guys the HBY share price has hardly ever been over $3 for he last 3 to 4 years

Earlier there was talk of them setting up in NZ anyway - if they don't get Hellaby going down that path could be interesting.

[macduffy]

You're probably on the mark there, winner. The market certainly seems to think so with the sp up another notch today at $3.33. Meanwhile, I'm happy with my each way bet, both HBY and BAP are showing gains.

There's no doubt that the automative business is the jewel in the HBY crown and I reckon BAP will pay up if they have to. HBY's Aussie auto business is significant, estimated to account for close to 40% of current year's auto turnover, according to the annual report. So BAP have more than just the NZ business to encourage them to sweeten the deal, if necessary.

[macduffy]

HBY directors aren't sparing any effort - or expense - in ensuring that shareholders get their "do nothing now" message. Two letters in the mail today, dated 3 October and 4 October, identical except for minor/subtle changes.

[Scrunch]

HBY directors aren't sparing any effort - or expense - in ensuring that shareholders get their "do nothing now" message. Two letters in the mail today, dated 3 October and 4 October, identical except for minor/subtle changes.

The expense isn't that much - there were only 6,192 shareholders as at the last annual report.

[macduffy]

Yes, nothing unusual in companies pulling out all stops to defend against an unwanted takeover bid. But two practically identical letters on consecutive days still seems a bit over the top.

On another tack, note that ACC has only committed a fraction of its holding to the BAP offer, at this stage. From the chairman's letters of 3 and 4 October:

"..... ACC has committed only 750,000 of its total holding of more than 8.8 million shares."

[Scrunch]

"..... ACC has committed only 750,000 of its total holding of more than 8.8 million shares."

Does anyone have any insights around the extent of the ACC pre-committed shares - is there some magical number that this helps achieve?
I understood key thresholds from the takeovers act were 20%, 50% and 90% but the Salt/ACC funds don't get them to 50% and they already had over 20% with the Castle shares alone.

Disc - holding

[macduffy]

Does anyone have any insights around the extent of the ACC pre-committed shares - is there some magical number that this helps achieve?
I understood key thresholds from the takeovers act were 20%, 50% and 90% but the Salt/ACC funds don't get them to 50% and they already had over 20% with the Castle shares alone.

Disc - holding

The latest annual report shows Castle Investments as a Substantial Security Holder of 27.71% of issued shares. According to the HBY letters, two other investors (ACC plus one other) have committed a combined total of 2.64% to a lock up agreement.

We don't - I think - know the terms of the agreement. It may be in the form of an option, allowing BAP to negate it - or it may be that BAP will be happy to settle for life as the major, but not controlling, shareholder, rather like Briscoe's with Kathmandu - for the present!

I hold both HBY and BAP.

[Sideshow Bob]

Grant Thornton will do their usual good job and i reckon come up with a $3.47 to $3.69 range.

Don't they come up with what they are paid to come up with?

[winner69]

Don't they come up with what they are paid to come up with?

Spot on - the $3.47 to $3.69 is what i reckon HBY will want to see as a range

[waikare]

INDEPENDENT ADVISER VALUES HELLABY SHARES IN A $3.60 TO $4.12 RANGE

INDEPENDENT DIRECTORS RECOMMEND SHAREHOLDERS REJECT BAPCOR’S OFFER

Hellaby Holdings Limited (NZX: HBY) advises that its Independent Directors unanimously recommend that shareholders REJECT the Bapcor Takeover Offer made on 21 October 2016.

The reasons for the recommendation are set out in full in the Target Company Statement, which incorporates the Independent Adviser’s Report prepared by Grant Samuel & Associates Limited, and accompanies this announcement.

Bapcor’s Offer of $3.30 for each Hellaby share is significantly below the Independent Adviser’s valuation range of $3.60 to $4.12 per share and below the Independent Directors’ own view of fair value.

The Independent Directors believe the Offer Price fails to reflect the full value of Hellaby and, in particular, its Automotive Group. The Independent Directors believe the Automotive Group has a stand-alone value of at least $350 million, excluding the significant synergies and other benefits that would be gained by Bapcor from a merger of the two businesses.

In addition, the Independent Directors believe the Offer price does not fully value Hellaby’s other Groups, Resource Services and Footwear, or reflect the considerable opportunity for future profitable growth under Hellaby’s recently communicated Group strategy.

In forming their recommendation to REJECT the Offer, the Independent Directors have had regard to a number of factors including the merits analysis in the Independent Adviser’s Report, the assumptions and other matters addressed in detail in the Target Company Statement.

The Target Company Statement is available on the Hellaby website at www.hellabyholdings.co.nz. The printing and mailing process is underway and printed documents will be dispatched to shareholders on 4 November 2016.

FY 2017 Financial Outlook

Included in the Target Company Statement are Board approved full year FY 2017 earnings forecasts for each of Hellaby’s continuing business groups - Automotive, Resource Services and Footwear. These forecasts have been used by the Independent Adviser as part of its valuation analysis.

While Hellaby’s Directors are not in a position to provide detailed guidance for the Group, the FY 2017 trading profit (excluding the gain on Equipment Group sale and the abnormal Footwear Group restructuring costs) is forecast to be significantly ahead of the FY 2016 year.

The Board has also provided additional earnings guidance for the Automotive Group, with Trading EBITDA forecast to grow from $26.8 million in FY 2016 to $31.1 million in FY 2017 and up to $35-$40 million in FY 2018 (a compound annual growth rate of 14% to 22%).

First Half FY 2017

Hellaby’s Net Profit After Tax for the first half of FY 2017 to 31 December 2016 will include a transactional gain of around $30 million from the recent sale of the Equipment Group.

Earnings results for the first half of FY 2017 compared to the FY 2016 first half period will reflect:

• Full period earnings from Premier Auto Trade (acquired 1 May 2016) and TBS Group (acquired 1 July 2016);
• Discontinuation of contributions following the sale of the Equipment Group on 30 September 2016, which means there is only three months of earnings from this Group in the FY 2017 half year period;
• The abnormal costs associated with implementation of the restructure and redundancy programme in the Footwear Group; and
• Continuing soft market conditions and trading for Contract Resources, with initiatives underway to improve performance.

There is no benefit in accepting early

Hellaby is aware that Bapcor representatives are canvassing Hellaby shareholders in connection with its Takeover Offer. The Independent Directors strongly recommend that shareholders wait to receive, and then carefully read and consider, the Target Company Statement including the Independent Adviser’s Report, before making a decision.

Shareholders are encouraged to seek professional independent and qualified financial advice if they are in doubt as to how to respond.

Consistent with the Independent Directors’ recommendation, all of Hellaby’s directors and senior management intend to REJECT Bapcor’s Offer in respect of all of the Hellaby shares that they hold or control.

As the Offer must remain open until at least 20 December 2016, there is no advantage in early acceptance and in fact there are significant potential disadvantages if accepted early.

The Independent Directors reiterate their recommendation that shareholders REJECT Bapcor’s Offer and recommend that all shareholders read the Target Company Statement including the Independent Adviser’s Report which accompanies this announcement.

[macduffy]

Someone's taking that independent adviser's valuation pretty seriously - HBY up to $3.40 today in a soggy market.

They may well be right but when was the last independent adviser's valuation that didn't confirm a takeover target's recommendation to its shareholders?

:cool:

[Jaa]

What a ridiculous argument, the Hellaby head office is only 5 people!


Bapcor states that Grant Samuel incorrectly excludes Hellaby's corporate head office costs from the valuation. If included, these costs would reduce Hellaby's value to $41.9 million from $47 million, or by 42 to 48 cents a share. That would give a target range price of $3.18 to $3.64, compared to the offer of $3.30 a share.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11753043

Bapcor won't be getting my shares voluntarily for less than $3.90.

[macduffy]

We Hellaby shareholders continue to be bombarded from all sides in this battle. Latest communications:

- 24 November. Hellaby Independent Directors rejecting Bapcor's criticism of the Grant Samuel report and valuation.

- 25 November. Trustees of the Hugh Green Trust and "Hugh Green Family Representatives and beneficiaries" explaining their reasoning behind the decision to accept Bapcor's offer.

Meanwhile, the offer looks better by the day as the market price retreats!

[Brain]

New lockup agreements conditional on a $3.60 offer

[Leftfield]

New lockup agreements conditional on a $3.60 offer

https://nzx.com/companies/HBY/announcements/293721

So big holders such as ACC, Pengana and Aspiring get $3.60 while small holders get $3.30. Is that OK?

[Brain]

My understanding is that every body will get the same price if the take over is successful.
I guess that this gives Bapcor a gauge on how much they have to pay to get all the acceptances they require.

[mondograss]

So they've come up to the bottom end of that valuation range that they were adamant overvalued the company.

[Brain]

Yeah - it's all about negotiation - don't offer your best price first. Also reading between the lines I don't think that Bapcor has raised their offer. They have just come to an agreement that if 360 is offered than these will be the new level of acceptance.

[macduffy]

Yeah - it's all about negotiation - don't offer your best price first. Also reading between the lines I don't think that Bapcor has raised their offer. They have just come to an agreement that if 360 is offered than these will be the new level of acceptance.

Agree. The market clearly expects an increased offer, HBY shares up 6.6% this morning to $3.41.

[Seti]

Not sure why the price hasn't gone to $3.60. Under the Takeovers Code -
- The offer has to be made to all Shareholders in the target company.
- The offer has to be on exactly the same terms for all Shareholders.
- If the offer price is increased, the additional amount has to be paid to everyone who accepts the Takeover Offer, even if they accepted before the price was increased.

The offer has been increased so why aren't Bapcor making an announcement in that regard?

[BlackPeter]

Not sure why the price hasn't gone to $3.60. Under the Takeovers Code -
- The offer has to be made to all Shareholders in the target company.
- The offer has to be on exactly the same terms for all Shareholders.
- If the offer price is increased, the additional amount has to be paid to everyone who accepts the Takeover Offer, even if they accepted before the price was increased.

The offer has been increased so why aren't Bapcor making an announcement in that regard?

You are right - IF Babcor decides to take over for $3.60, than it needs to pay this amount to everybody accepting the offer. However - Takeover is so far not unconditional, which means if Bapcor decides to pull out of the offer than today's buyers sit on quite dear shares.

Market is just pricing in the risk that Bapcor still might walk away from its offer.

[Leftfield]

Not sure why the price hasn't gone to $3.60. Under the Takeovers Code -
- The offer has to be made to all Shareholders in the target company.
- The offer has to be on exactly the same terms for all Shareholders.
- If the offer price is increased, the additional amount has to be paid to everyone who accepts the Takeover Offer, even if they accepted before the price was increased.

The offer has been increased so why aren't Bapcor making an announcement in that regard?

Thanks for this explanation..I'm learning a lot by watching this one.

[artemis]

Hellaby board now saying that the offer should be $3.60 plus a dividend about 18c to use up imputation credits. First I heard of that. The board seems to be scrambling. Sounds like Bapcor might not be willing to go that far, bringing some uncertainty into the mix.

[macduffy]

Hellaby board now saying that the offer should be $3.60 plus a dividend about 18c to use up imputation credits. First I heard of that. The board seems to be scrambling. Sounds like Bapcor might not be willing to go that far, bringing some uncertainty into the mix.

Bapcor say $3.60 is their final offer. No 18c dividend.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11761584

[warthog]

Takeovers are all about tempo and strategy.

The hog can easily see Bapcor going to $3.75 if not $3.78 (+5%) precisely if that's what it takes to do the deal.


Bapcor say $3.60 is their final offer. No 18c dividend.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11761584

[macduffy]

Takeovers are all about tempo and strategy.

The hog can easily see Bapcor going to $3.75 if not $3.78 (+5%) precisely if that's what it takes to do the deal.

Maybe. Meanwhile they need to be careful that they don't make any definitive statement about the $3.60 "final" offer unless they're serious about that. Takeover rules are strict on the point.

[macduffy]

HBY down 1c today, BAP (ASX) up 39c. Looks like the speculative fizz has gone out of the HBY shareprice and that the market now accepts that Bapcor are serious about this being as high as they will go.

[traineeinvestor]

Craigs have recommended their clients accept the NZ$3.60 offer:http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11766988 According to the article, Craig's clients hold 14% of HBY shares. Obviously, not all of them will necessarily follow Craig's advice, but I would expect quite a few will.

Bapcor already holds 40% and, with the shares still trading at below the offer price by enough to allow arbitrage, I would be surprised if (i) they do not get to 50% or (ii) there is any increased offer from either Bapcor or anyone else.

Time to wave the white flag, I think.

[macduffy]

Yes, looks inevitable, but there's no need to hurry to accept. The offer doesn't close until 18 January and early acceptance doesn't mean early payment.

[Glendoonie]

What does this mean? What attachment? All I can see is the notification from ASB Securities.

TAKEOVER: HBY: HBY Letter to Shareholders

Hellaby Holdings Limited (NZX:HBY) advises that it has sent a letter to its
shareholders, outlining its recommendation that shareholders do not accept
the revised Bapcor offer. A copy of the letter is attached.
End CA:00294580 For:HBY Type:TAKEOVER Time:2016-12-20 08:30:17

[winner69]

What does this mean? What attachment? All I can see is the notification from ASB Securities.

TAKEOVER: HBY: HBY Letter to Shareholders

Hellaby Holdings Limited (NZX:HBY) advises that it has sent a letter to its
shareholders, outlining its recommendation that shareholders do not accept
the revised Bapcor offer. A copy of the letter is attached.
End CA:00294580 For:HBY Type:TAKEOVER Time:2016-12-20 08:30:17

Say's don't sell to those cheeky miserable Aussies .....in other words ignore the offer until further notice

https://www.nzx.com/files/attachments/250428.pdf

[macduffy]

Methinks they (HBY directors) doth protest too much. Talk of selling the footwear business has been around for years, with no signs that anyone's interested in taking this off Hellaby's hands (feet?) - or at least, not at an acceptable price. As for the Contract Resources business, this has proven to have been acquired by HBY at a great time for the vendors but I guess it may turn a profit at some time in the future. So it boils down for me as to whether or not the BAP offer is sufficiently attractive to justify selling the automotive business.

Meanwhile, no hurry to make a decision. The offer is still conditional and doesn't close until 18 January.

[traineeinvestor]

The shares are still trading at a discount to the offer price suggesting market skepticism about the offer becoming unconditional. If the share price remains below the offer price, I'd expect a flurry of last minute acceptances (including mine if there are no new developments).

[Glendoonie]

Thanks for posting the link to the letter "https://www.nzx.com/files/attachments/250428.pdf". The professional advice I received was to accept the offer ASAP. No whys and wherefores. I am leary of professional advice. Been burned before.

I'll wait and see how this game of ping-pong plays out.

[macduffy]

Thanks for posting the link to the letter "https://www.nzx.com/files/attachments/250428.pdf". The professional advice I received was to accept the offer ASAP. No whys and wherefores. I am leary of professional advice. Been burned before.

I'll wait and see how this game of ping-pong plays out.

Meanwhile, I'd be inclined to ask the professional adviser - "Why the ASAP?"

[Glendoonie]

Meanwhile, I'd be inclined to ask the professional adviser - "Why the ASAP?"

Said professional is a friends brother; its complicated.:confused:

[macduffy]

Fair enough. Not worth stressing over.

:)

[peat]

take the money (on market) and run is my thoughts.
missing out on 16 c and paying brokerage wont compensate for the risk you'll be left stranded with some shares that will almost certainly be re-rated back to pre-offer levels.

[mondograss]

take the money (on market) and run is my thoughts.
missing out on 16 c and paying brokerage wont compensate for the risk you'll be left stranded with some shares that will almost certainly be re-rated back to pre-offer levels.

It's a full buy out offer, unlike AWK. They want all of the shares so why pay the brokerage and take the haircut on the sale price if you don't need to?

[macduffy]

It's a full buy out offer, unlike AWK. They want all of the shares so why pay the brokerage and take the haircut on the sale price if you don't need to?

Peat is pointing out the risk that BAP won't secure enough shares and might can the offer. After all, it is still conditional and no-one really knows if BAP will be prepared to be a substantial shareholder without full ownership. Personally, I'll let matters run for a while yet.

[peat]

Peat is pointing out the risk that BAP won't secure enough shares and might can the offer. After all, it is still conditional and no-one really knows if BAP will be prepared to be a substantial shareholder without full ownership. Personally, I'll let matters run for a while yet.

indeed.thanks McDuff. i think they can drop back to as far as 50%

[Glendoonie]

Great to get all those different perspectives. When I look at Hellabys on market things seem dead almost. THAT must mean something. I am inclined to hang on for now.

BTW I have emailed said professional who is a friends brother. Like I need another perspective? No, but I'll get it anyway. :)

[BlackPeter]

A view from the NZSA:

http://www.nzshareholders.co.nz/pdf/correspondence/Hellaby%20Holdings%20Takeover%20Offer%20-%20pdf.pdf

If you want to support them ... join here:

http://www.nzshareholders.co.nz/index.cfm

[Glendoonie]

My acceptance form is signed and sealed. Not posted yet, but that's just the last step.

[BeeBop]

My acceptance form is signed and sealed. Not posted yet, but that's just the last step.

and mine too, although scanned to be emailed....happily, I just found out that I had double the shares I had thought! Have been watching HBY since the late 1990's and only got in last year....now only to be "got out" but thankfully ahead.

[Glendoonie]

It's no too much to ask - to get out and be ahead. I wish it had happened every time I sold :-)

[Glendoonie]

No much trading in HBY today. Ask price $3.52. I doubt it was my shareholding that helped the SP reach it's tipping point. I accepted the Bapcor offer. It's all over now for me.

Summary of substantial holding
Class of quoted voting products: Ordinary shares
Summary for Bapcor
For this disclosure,--
(a) total number held in class: 48,965,439 ordinary shares
(b) total in class: 97,727,180 ordinary shares
(c) total percentage held in class: 50.104% (rounded to three decimal places)

For last disclosure,--
(a) total number held in class: 47,590,976 ordinary shares
(b) total in class: 97,727,180 ordinary shares
(c) total percentage held in class: 48.698% (rounded to three decimal places)

[macduffy]

Yes, I'd expect that number to increase slowly as the 18th January looms. Largely a matter now of shareholders deciding whether or not they want to risk being locked in behind a majority shareholder.

[Leftfield]

Today's announcement.....



Bapcor waives the condition in the Offer requiring the receipt by it of acceptancesrepresenting 90% or more of the voting rights in Hellaby

As Bapcor has already received acceptances in respect of more than 50% of the HellabyShares, the waiver of the 90% condition means that the minimum acceptance condition inthe Offer has been satisfied

[traineeinvestor]

Reluctantly sent in my acceptance today.

Already have too much cash looking for a new home ....

[BlackPeter]

Reluctantly sent in my acceptance today.

Already have too much cash looking for a new home ....

Lots of good companies currently and in an uptrend ... NZK, CDI, SKL, STU, THL, TNR to name just a few. Admittedly - its a difficult task to pick the most beautiful.

No buying recommendation, but if you don't know what to do with your money, than it might be worth your while to invest some time into researching them (i.e. DYOR).

Discl: hold all of above (and some more);

[macduffy]

Bapcor's interests edging up as 18 January draws nearer - 52.534% today - and HBY's shareprice edges closer to the $3.60 as arbitragers close in on the small margin.

Disc: Posted my acceptance yesterday - it won't move the numbers much! Regret losing exposure to the automotive business - but havn't really as I bought a corresponding interest in BAP a couple of months ago.

[macduffy]

BSP have now declared the offer unconditional and extended it to 7 February.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11781729

[BlackPeter]

Still wondering whether you should accept the offer?

Here is the NZSA view: http://www.nzshareholders.co.nz/pdf/correspondence/Hellaby.pdf

If you want to support the good work of the NZSA - join here: https://www.nzshareholders.co.nz/members.cfm

Discl: NZSA member;

[macduffy]

HBY's independent directors accept that the battle's over and recommend acceptance of the Bapcor offer. It could be said that they did their job in boosting the initial bid for the benefit of all shareholders.

[winner69]

HBY's independent directors accept that the battle's over and recommend acceptance of the Bapcor offer. It could be said that they did their job in boosting the initial bid for the benefit of all shareholders.

........seeing it was not worth what they reckoned it to be.

Their failure, if anything,was allowing HBY to become so attractive for a takeover.

One of their roles is to insulate the company from that happening if they believe it's worth heaps.

[Bob]

Sellers have been paid overnight nice not to pay brokerage

[BeeBop]

Sellers have been paid overnight nice not to pay brokerage

Money in account and now I need to decide where to put it! Probably a managed fund as I am getting a little bit over the NZ market at the moment.

[peat]

no mucking around by the new owners with The Board. :ohmy:

[macduffy]

Bapcor edging closer to the 90% threshold - and talking up the value of the shoe business, now that they have control!

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11791333

;)