ABA Abano health

[forest]

And I really like how they've ditched their other businesses like radiology and audiology to focus just on dental.
Shows conviction of their strategy.

I agree with you JayRiggs, last 3 years Debt to Equity has reduced from 99% to 50%.
Dividend has been going up and we have a more focused company.
Net margin was also higher in 2H18 than in the prior 3 six months periods.

[zigzag]

Does anybody has an idea why share price is going down the hill despite record profits, more clinics bought in AUS and NZ? is it a good buy at $8.20 or share bound down hill?

Could be one holder selling a large parcel of shares? There has been fairly high volume in the last few weeks, and because ABA is not a highly liquid stock this has been putting downward pressure on the shareprice. At least the selling is being absorbed, albeit at a discount.

[KJ]

Suggest you read Percy's last post as it is very relevant.
ALSO
(1) NPAT includes profit on sale of subsidiary-2.1m.For comparison purposes you need to exclude this & adjusted NPAT is $10.7m,down 4%
(2) 4.2m new shares were issued to fund its purchases of new businesses.Very importantly EPS has fallen 20% from 51.8 to 41.7
(3)This puts the PE on 21
(4)In addition to the share issue it received 17m from the sale of its subsidiary-cash on hand at year end was only $7-where is future funding coming from?
(5) Goodwill in BS stands at $227m.It has paid roughly $1m goodwill per business purchased.Each business contributes approx $47,000 npat per annum
so it will take about 20yrs profits to cover the goodwill.
(6) In the last yr it paid $38m in goodwill for 19 businesses.
(7) ROE was 7.7%
It really needs to be achieving a much better profit for each practice.The worry could come with goodwill writedowns for non performing businesses.Goodwill in
the books exceeds Equity.
Just my thoughts.

[BlackPeter]

Lacking any other detrimental company specific information would I say the chance that Abano is close to an (at least) local minimum is higher than the chance this drop continues unabated - i.e. no matter whether we see it as sell or not - now might not be the best time to do so.



just to tie up- this thread ...

when I wrote above the SP was in the 8.20'ies. Now its in the 8.70'ies - and it looks like the upwards movement went out of puff.

Of course - it could gain steam again, but so far it looks like the MA100 is a quite effective resistance level.

I probably don't need to spell out what this means ...

GLTAH ...

[Entrep]

This is looking like interesting value again, had written it off earlier this year but could be a nice share to add to the dividend portfolio around these levels...

[peat]

Fisher Funds have dumped according to headline at NBR

[BlackPeter]

This is looking like interesting value again, had written it off earlier this year but could be a nice share to add to the dividend portfolio around these levels...

Forward PE = 14.1; forward CAGR 14.9; PEG 0.94; Not too bad, but this is obviously only if we believe the predictions of the analysts.

On the other hand - EPS for this company is in the past wildly jumping around - i.e. not sure what the past says about the future. In general - companies which base their business model on buying and integrating smaller business tend to buy over time dearer and dearer which tends to negatively impact on their own EPS growth rates.

I'd see ABA around $8 as fairly valued ... not really a bargain yet. Ah yes - and the TA looks quite ugly. Difficult to pick bottoms. But sure - there well may come a time when it is a buy :):

[James108]

I keep an eye on this as well, will be interested if they start to turn Australia declining sss around.

[winner69]

......
....companies which base their business model on buying and integrating smaller business tend to buy over time dearer and dearer which tends to negatively impact on their own EPS growth rates.

I'd see ABA around $8 as fairly valued ... not really a bargain yet. Ah yes - and the TA looks quite ugly. Difficult to pick bottoms. But sure - there well may come a time when it is a buy :):

Been religiously updating the financials in my model and not much improves

All the extra capital not really generating much more in the way of returns. ROIC remains 6%/7% range and doesn'y cover their cost of capital

As such I would consider $8 more than 'fairly valued' .....and some way off being a 'bargain'


Buy hype might take them higher in short term

[777]

Fisher Funds have dumped according to headline at NBR

And Harbour have upped their holding.

[BlackPeter]

HY results are out.

https://www.abano.co.nz/news/2018/12/20/abano-hy19-results/

Revenue slightly up (as per analyst consensus), earnings flat-lining though (looking worse than analyst consensus if the first HY is representative for the FY). it appears that all these ugly costs like consumables, employee benefits and similar are growing faster than revenue.

Could be a one - off due to timing the account, but could as well turn into a bad habit.

On the other hand - they discovered that the "underlying profit" grew nicely compared to last years underlying profit. Must be all nice and fluffy, than :);

[winner69]

Don't know whether good or bad BP

Need to update my numbers but first impression is that its not good. Since May 17 (3 quarters) total capital employed has increased about $75m (increases in both debt and equity) but EBIT not moving up much. Seem to be spending heaps acquiring things but not making much more money.

Will look at the detail one day soon

Lot of moving things around in the accounts eh -- continuing, discontinued, underlying etc etc

[winner69]

Updated my magic spreadsheet on Abano.

Equity and debt increasing (invested capital) as time goes on and revenues growing but EBIT margins and return on invested capital both trending down....not good. Buying business for little extra returns.

Not ‘normalised’ or ‘underlying’ but just as reported but left out gains on asset sales

Would want to see improved financials before I would get really interested. Current p/b of ~1 not deserved on fundamentals and even the perceived low PE and good yield is not seductive enough for me.

That’s how I see it anyway

Key ratios below

[winner69]

Truly amazing ABA share price was about 10 bucks this time last year ...but not surprising on financial performance it’s about the same as it was 5 years ago

[BlackPeter]

Truly amazing ABA share price was about 10 bucks this time last year ...but not surprising on financial performance it’s about the same as it was 5 years ago

Didn't they defend in 2016/2017 with teeth and claws against a takeover bid for over $10 per share? Looks like the board has some explaining to do what happened with shareholder value, but than - I am probably just not bright enough to understand their deep value game ;);

Must be amazing now.

[hamish]

Part of the answer is.. How long is a reasonable period to integrate new sites, integrate systems, people and culture and start to realise gains..?? 6months, 12? 18? 24?. Similar story for Z with Caltex sites, EVO etc. How long before SKC assets such as ICC really bears fruit etc... They are shifting from acquire to integrate so as a sharehder/owner I'm OK with 24 months personally for scale to materialise...yes, It is a heavy expertise and people intensive play..so acquisition approach is not without risk and reward... Have to balance against opportunity, market size, brand etc. Current Yield and DRP 3% reduced SP enough to entice buy n hold for 2 years from me.

[winner69]

Part of the answer is.. How long is a reasonable period to integrate new sites, integrate systems, people and culture and start to realise gains..?? 6months, 12? 18? 24?. Similar story for Z with Caltex sites, EVO etc. How long before SKC assets such as ICC really bears fruit etc... They are shifting from acquire to integrate so as a sharehder/owner I'm OK with 24 months personally for scale to materialise...yes, It is a heavy expertise and people intensive play..so acquisition approach is not without risk and reward... Have to balance against opportunity, market size, brand etc. Current Yield and DRP 3% reduced SP enough to entice buy n hold for 2 years from me.

Fair enough Hamish

It’s just that many of companies that undertake these market consolidation strategy by acquiring lots of small participants often don’t end up as a good story, especially when they stop acquiring.

Pity you mentioned EVO ...case in point.

[hardt]

My worst performer of the year is now trading at PER12.5 - 5xEBITDA - 7.5% gross yield

Acquisitions have not contributed to the full trading period, FY19 EBITDA around 36-38M

Not looking too bad, company will continue well in an attractive industry.

Not much to worry about ( apart from a bitta debt )

[hamish]

Fair enough Hamish

It’s just that many of companies that undertake these market consolidation strategy by acquiring lots of small participants often don’t end up as a good story, especially when they stop acquiring.

Pity you mentioned EVO ...case in point.


Hmm yeah, typed EVO and thought to myself.. brave to note. Yet, it's highlights the risk / reward so is valid counter-side to consider..

[Valleytrader]

Does anyone have a view on this company? I see that the price ended last week at $5.95 per share, and has a dividend yield of over 6% (according to directbroking).

[777]

Does anyone have a view on this company? I see that the price ended last week at $5.95 per share, and has a dividend yield of over 6% (according to directbroking).

They were $10 not so long ago.

[peat]

They were $10 not so long ago.
which almost certainly has to mean they are a better buy now than then

one needs to consider the ongoing viability of the business model namely commoditizing and franchising dentistry. at some point the easy fruit will have been taken and growth will be harder to obtain.

[winner69]

Took a lot of buzz words and good strategy stuff to finally say this year’s profit going to be 10% less than last years. No real surprise here

And cutting back big time on acquisitions ...where’s growth going to come from now?



http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/ABA/332450/297360.pdf

[percy]

A lot of capital required for acquisitions,which have a very poor return on capital..
Very little growth from each practice.
Revenue growth is mainly driven by acquisitions.
I do not think dentist have "pricing power".
A visiit to the dentist is easily put off when times are tough.
Australian mortgage requirements,ie a stop to interest only loans will cause hardships.
Increasing mortgage interest rates will work against ABA's clients too.

Posted 03-08-2018.
I still rate ABA as avoid.

[winner69]

Posted 03-08-2018.
I still rate ABA as avoid.

Agree percy

A few months ago they said that they acquired 14 practices in H1 and they would contribute $6m extra annualised ebitda

Appears not ...or if they are the existing practices are going back fast

One good thing as acquisitions canned for a while they say (hint) no need for a capital raise.

Would be surprised if share price $4 something soon.

[winner69]

The announcement said npat forecast to be $9m (before year-end review of goodwill)

Oh dear ....wonder how much impairments will be ...ie how much they have overpaid for practices

Non-cash of course so no worries and won’t affect dividends ..that’s good

[BlackPeter]

Posted 03-08-2018.
I still rate ABA as avoid.

... and you are probably right.

Interesting question is - is there any price where you think it is a buy again? I guess in a way they do remind me at the (Australian) Greencross (vetcare and animal food). They had an amazing growth phase fuelled by lots of aquisitons - the shareprice boomed and peaked above $10. They made the cardinals mistake most growth by aquisition companies do at some stage - they started to pay too much for additional growth and market realised at that stage that they are in a bubble and any additional aquisition will reduce PE ratio. Shareprice crashed subsequently down to something like $3.70 ... and then somebody came and took the company over (around $5.50).

Realistic scenario for ABA as well?

[winner69]

... and you are probably right.

Interesting question is - is there any price where you think it is a buy again? I guess in a way they do remind me at the (Australian) Greencross (vetcare and animal food). They had an amazing growth phase fuelled by lots of aquisitons - the shareprice boomed and peaked above $10. They made the cardinals mistake most growth by aquisition companies do at some stage - they started to pay too much for additional growth and market realised at that stage that they are in a bubble and any additional aquisition will reduce PE ratio. Shareprice crashed subsequently down to something like $3.70 ... and then somebody came and took the company over (around $5.50).

Realistic scenario for ABA as well?

On the other hand could go the Evolve way

[BlackPeter]

On the other hand could go the Evolve way

It well might do, though I think there is is (rightly or wrongly) more money in dental than in child care ;);

[percy]

Agree percy

A few months ago they said that they acquired 14 practices in H1 and they would contribute $6m extra annualised ebitda

Appears not ...or if they are the existing practices are going back fast

One good thing as acquisitions canned for a while they say (hint) no need for a capital raise.

Would be surprised if share price $4 something soon.

"and a lift in revenue per clinical day"..?
Try charging customers more per visit,when Aba are known as charging plenty will not work.
Getting dentists to see more customers per day will not work as they have trouble keeping their existing customers,let alone attracting more customers.
Try "add ons" does not work,as customers are not stupid.
Really think their business model is suspect,therefore it would be hard to value the business.
The days of paying too much for "roll outs" are well past us.
They were correct to advise there will be no further capital raise.
Time has shown the money Aba were making was in hearing.Since sold.

[winner69]

It well might do, though I think there is is (rightly or wrongly) more money in dental than in child care ;);

Normalised ebit margins are about the same ...and probably higher than looking after old people

[winner69]

BP...how much would you pay for the 36 cent divie ....considering all the risks involved.

[BlackPeter]

BP...how much would you pay for the 36 cent divie ....considering all the risks involved.

Good question. Don't like though to value companies based on their divvie - too much risk they pay at some stage divvie out of their capital, and we know how this goes.

Difficult as well to establish for Abano a trustworthy "average" EPS, given that it used to jump around widely over the years. However - if we assume that the analyst forecasts are right and the dental business is steady, than forward EPS seems to be around (or slightly above) 50 cents per share.

Using the famous factor 8.5 from Grahams formula (and accepting a number of risks), this would mean that ABA would be fairly priced around a shareprice of $4.25; It might be (all things being equal) a bargain with a $3 handle and a not too high decimal behind the 3 ;).

Ouch. Was this the board fighting a couple of years ago with teeth and claws against a takeover offer North of $10? I think this board has some explaining to do ... maybe I need to amend my "Never Again" list.

[percy]

... and you are probably right.

Interesting question is - is there any price where you think it is a buy again? I guess in a way they do remind me at the (Australian) Greencross (vetcare and animal food). They had an amazing growth phase fuelled by lots of aquisitons - the shareprice boomed and peaked above $10. They made the cardinals mistake most growth by aquisition companies do at some stage - they started to pay too much for additional growth and market realised at that stage that they are in a bubble and any additional aquisition will reduce PE ratio. Shareprice crashed subsequently down to something like $3.70 ... and then somebody came and took the company over (around $5.50).

Realistic scenario for ABA as well?

What price would I buy.?
I doubt I would buy back in at any price, as I do not like their business model.
I prefer to pay a fair price for a good company,rather than a good price for a fair company.

[winner69]

Guidance not that good for F19 .....not unexpected

Share price now below $5 ....not unexpected

Probably more pain to come I reckon

[Sideshow Bob]

Went to a Lumino today - not going back.

That's 1 less customer.

[peat]

Went to a Lumino today - not going back.

That's 1 less customer.

but why Bob? What exactly caused your discontent, and why would you expect another provider to be better?
Or is it just that you hate paying dentists bills? I know I do, as they always seem so extreme.

[percy]

Went to a Lumino today - not going back.

That's 1 less customer.

Try my dentist.
Nigel Bratten at Papanui Dental Centre ,457 Papanui Road,ChCh.ph 352 6019.

[janner]

Try my dentist.
Nigel Bratten at Papanui Dental Centre ,457 Papanui Road,ChCh.ph 352 6019.

Is that next door to a Turners site Perc..?.

The ticket clippings must be getting quite lucrative by now... Lol...

[percy]

Is that next door to a Turners site Perc..?.

The ticket clippings must be getting quite lucrative by now... Lol...

Charity on my part.
As the tax dept says "I am here to help you."

[Sideshow Bob]

but why Bob? What exactly caused your discontent, and why would you expect another provider to be better?
Or is it just that you hate paying dentists bills? I know I do, as they always seem so extreme.

Had a check-up - I thought was a reasonable/fair price, which included X-Rays. Needed a small filling - told I would need a 45 minute appointment. Appointment was only 5 minutes longer than the check-up and under half the 45 minutes, but was approx. 130% higher than the check-up.

Hard not to be cynical. I don't mind the fee necessarily, but want to feel like you get value for money, and not taking the yellow-coloured water.

Last dentist (in another city) was no better.

[hardt]

Yikes, bit of a roughie.

it's not the end of the world and at 6-7* FY19 underlying earnings it's not looking horrible from here... Maybe that free dentistry plan from govt will get through.
I have a small holding that I may regret adding to from here .. time will tell.

[peat]

Had a check-up - I thought was a reasonable/fair price, which included X-Rays. Needed a small filling - told I would need a 45 minute appointment. Appointment was only 5 minutes longer than the check-up and under half the 45 minutes, but was approx. 130% higher than the check-up.


It could be the material they use for the filling?? Or is it just a flat fee for a filling and they try to churn them through.

I think transparency is the key to knowing whether you're getting value at a dentist , not something I've seen a lot of.
Thanks for answering.
I guess I'm interested because after years of paying so much for dentistry I'd like to think its a profitable business and now I can have a bit of that myself but need to do more homework on this one.

[percy]

It could be the material they use for the filling?? Or is it just a flat fee for a filling and they try to churn them through.

I think transparency is the key to knowing whether you're getting value at a dentist , not something I've seen a lot of.
Thanks for answering.
I guess I'm interested because after years of paying so much for dentistry I'd like to think its a profitable business and now I can have a bit of that myself but need to do more homework on this one.

Take care.
One of my librarians told me she was very concerned about her son.Just qualified as a dentist with a $115,000 student loan,and with an over supply of dentists his job prospects did not look bright.
Sorry I have since retired from book selling and can not update the story.
I should also point out my wife is now using my dentist as her two previous dentists charged too much.
I think most of us know when we are being charged too much.

[peat]

I think most of us know when we are being charged too much.

Dentists. Every. Time.

[Sideshow Bob]

It could be the material they use for the filling?? Or is it just a flat fee for a filling and they try to churn them through.

I think transparency is the key to knowing whether you're getting value at a dentist , not something I've seen a lot of.
Thanks for answering.
I guess I'm interested because after years of paying so much for dentistry I'd like to think its a profitable business and now I can have a bit of that myself but need to do more homework on this one.

It isn't so much the fee as such, but the complete lack of transparency.

I remember my previous dentist, he said when doing some work "only about 1/3 a filling so will charge you 1/3 the price". Literally it was under 3 minutes work....

[Jay]

Shame I don't live in your neck of the woods, I'm sure I financed my dentist's holidays and eventually his retirement. At least the hygienist charges by time and not a flat fee.
The price for a check up with the dentist equates to some horrendous hourly rate

[winner69]

Jeez ...another 11% shaved off the share price again today

Close $4.40 at low of the day as well ....pretty ominious sign ...but maybe a day 3 bounce tomorrow

[BlackPeter]

Jeez ...another 11% shaved off the share price again today

Close $4.40 at low of the day as well ....pretty ominious sign ...but maybe a day 3 bounce tomorrow

Well, yes this was fast. They might be in for a speeding ticket?

Anyway - if they keep this momentum, they might soon reach fair value (unless there are still things lurking in the closets). Being cheap might take a couple of days more :);

Guess the guys who tried to do a couple of years ago a hostile takeover for over $10 (fight off by the ABA board) are smiling now every day when they look at their accounts and realise that they still have the cash instead of the lousy shares ;);

[hardt]

Well, yes this was fast. They might be in for a speeding ticket?

Anyway - if they keep this momentum, they might soon reach fair value (unless there are still things lurking in the closets). Being cheap might take a couple of days more :);

Guess the guys who tried to do a couple of years ago a hostile takeover for over $10 (fight off by the ABA board) are smiling now every day when they look at their accounts and realise that they still have the cash instead of the lousy shares ;);

Who is to say Healthcare Partners could not have done a better job?

[BlackPeter]

Who is to say Healthcare Partners could not have done a better job?

Fair enough ... seems at this stage difficult to imagine anybody could have done a worse job. We probably will never know unless ... they wait another couple of days and make another offer just shy of $4?

[whatsup]

Down again , not the flavour of the week, big regigging of the financials having to take place with ABA before the market can settle on a value here imo!

[percy]

David Bridgeman article in NZ Herald would not have helped;
"Abano drills into uncomfortable territory with dental backtrack."

[whatsup]

What a mess !!

[winner69]

What a mess !!

Yes it seems an impending train wreck

https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12217257

Love the bit about the strategic review and hope they 'wont find any more cavities' ....I reckon they will and that extractions will be necessary

[KJ]

Suggest you read Percy's last post as it is very relevant.
ALSO
(1) NPAT includes profit on sale of subsidiary-2.1m.For comparison purposes you need to exclude this & adjusted NPAT is $10.7m,down 4%
(2) 4.2m new shares were issued to fund its purchases of new businesses.Very importantly EPS has fallen 20% from 51.8 to 41.7
(3)This puts the PE on 21
(4)In addition to the share issue it received 17m from the sale of its subsidiary-cash on hand at year end was only $7-where is future funding coming from?
(5) Goodwill in BS stands at $227m.It has paid roughly $1m goodwill per business purchased.Each business contributes approx $47,000 npat per annum
so it will take about 20yrs profits to cover the goodwill.
(6) In the last yr it paid $38m in goodwill for 19 businesses.
(7) ROE was 7.7%
It really needs to be achieving a much better profit for each practice.The worry could come with goodwill writedowns for non performing businesses.Goodwill in
the books exceeds Equity.
Just my thoughts.

My post from August.. a big problem now is $220m in goodwill sitting in the books with write-offs coming.
NTA/share of -$4.08. Yes MINUS!
Basically they have been paying far too much for the businesses.I wonder if it can survive?

[winner69]

So 32% slashed off the share price since announcement

Recent performance suggested a share price with a 3 in front of it was inevitable

Wonder what next week brings

[Lola]

So 32% slashed off the share price since announcement

Recent performance suggested a share price with a 3 in front of it was inevitable

Wonder what next week brings

Relatively new chairman Philippa has had a few hospital passes ...this one to go with Solid and First Gas.

[trader_jackson]

Wowee those guys at Forsyth picked it well yet again... similar to EVO (right before it fell off a cliff), on 10th October Forsyth (when the share price was $8.20) sent out a note to remove Abano Healthcare from their 'conviction list', although they mentioned they were still positive on the stock and the same day released a report with a target price of $10.25.

Just under 6 months later the share price is $3.90 (and they, on 27th march 2019, now have a target price of $5.75)

A kick in the teeth all round.

[winner69]

Share price way back up ...maybe like the phoenix rising from the ashes

[BlackPeter]

Share price way back up ...maybe like the phoenix rising from the ashes

10461

"way back up"? Looks like a very short way to me ;); I think the emphasis in your statement should be on the "maybe". Looks more like a flop than a Phoenix.

Anyway - still light years away from any confirmed trend change.

[BlackPeter]

Just realised that analyst consensus dropped significantly since I last looked:

https://www.marketscreener.com/ABANO-HEALTHCARE-GROUP-LI-6496185/financials/

Future revenue growth hardly keeping up with inflation and EPS predicted to be only in the upper 30 cents range. What is a no growth share with an average EPS of 38 cents worth? Remember - analysts are always over optimistic. A 3 handle might be here more appropriate than a 4 handle ...

[Leftfield]

Share price way back up ...maybe like the phoenix rising from the ashes

A 2 yr chart tells it better.

10462

Maybe more like a dead cat bounce.....their expansion by acquisition model is looking seriously flawed and while $4.00 maybe the bottom of the current cycle, any further bad news from this company could see further erosion.

I don't hold, and I wouldn't be rushing to buy ABA until there is much better news and the SP is on a more definite uptrend.GLH.

[winner69]

Been one hot stock the last few days

So it was cheap as below 4 bucks

[percy]

Been one hot stock the last few days

So it was cheap as below 4 bucks

Maybe,but I have doubts.
Recently read an article on Smiles and the sector looks a disaster.
The leases on all their practice's should be test of character.
Leave it to you W69.

[BWH]

Share price really racing down now. Wish I'd sold my meagre holding when I thought about it a year ago!

[carrom74]

https://www.nzx.com/announcements/336905

Trading update...Dividend shelved to 8cents from 20cents YOY...

The last paragraph is interesting...

Consolidation activity in the dental sector in Australia is ongoing. Abano has received various expressions of interest, which may offer strategic opportunities and value to shareholders. The Board will evaluate these and the company’s participation, as part of its ongoing review of strategy, asset mix and capital structure. There is no certainty that any expression of interest will lead to a proposal for shareholders to consider or to any transaction, either in respect of Abano itself or the company’s businesses....

One more shot by Healthcare partners???? at a reduced offer price?

[whatsup]

Is this a turn-a-round story ?

[percy]

Perhaps .
Maybe if they sold their complete Aussie business.
Selling bits will not achieve much.The NZ business is the better business,or more correctly, not as bad a business as the Aussie one.
I read between the lines some dentists are only working 2 or 3 days a week, and they need more/other dentists to use "the Chair" for the rest of the week.
Confirms to me dentists are over paid.

[whatsup]

Perhaps .
Maybe if they sold their complete Aussie business.
Selling bits will not achieve much.The NZ business is the better business,or more correctly, not as bad a business as the Aussie one.
I read between the lines some dentists are only working 2 or 3 days a week, and they need more/other dentists to use "the Chair" for the rest of the week.
Confirms to me dentists are over paid.

Does not surprise my, pulling a tooth @ $380 a time , 15 minutes work !!!!

[winner69]

Nothing like keeping the takeover talk alive to support the share price

[Filthy]

Nothing like keeping the takeover talk alive to support the share price

my thoughts exactly w69..... reckon they are just trying to prop up the SP!

[garfy]

I don't wish to be contradictory, but.... 'Percy' thinks Dentists are overpaid.... 'whatsup' states that "pulling a tooth @ $3.80 a time, 15 minutes work.." ( $15.20 an hour!!!!)

[percy]

I don't wish to be contradictory, but.... 'Percy' thinks Dentists are overpaid.... 'whatsup' states that "pulling a tooth @ $3.80 a time, 15 minutes work.." ( $15.20 an hour!!!!)

I think he meant $380.or $1520 an hour.That's why so many work two or three days a week.

[peat]

I don't wish to be contradictory, but.... 'Percy' thinks Dentists are overpaid.... 'whatsup' states that "pulling a tooth @ $3.80 a time, 15 minutes work.." ( $15.20 an hour!!!!)

are you serious
did you really not think that was a typo?

[Sideshow Bob]

That was in line with I got charged last time at Lumino. About $300-odd. They made a 45 min appointment and did it in 20 mins. Still got charged the same!

[trader_jackson]

https://www.nzx.com/announcements/341554

Intriguing stuff...

that AFR article mentioned "For now, it looks like First NZ Capital-advised BGH is in the box seat to take Abano in full. The fact it has been granted exclusivity by Abano, which is advised by Rothschild and Cameron Partners, is a strong indication BGH’s offer is at a substantial premium to Abano’s trading price and worthy of endorsement by the board."

[winner69]

Well, the get out of jail card has arrived ...at $5.70

Not as good as the offer of a few years ago but still a relief for most of us.

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/ABA/344086/311570.pdf

[BlackPeter]

Well, the get out of jail card has arrived ...at $5.70

Not as good as the offer of a few years ago but still a relief for most of us.

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/ABA/344086/311570.pdf

This the same board who fought a couple of years ago against a takeover offer of more than $10 per share?

Not sure whether they will end up in the books as the most delusional board in NZ history (might be a draw with STU ..), but the directors clearly belong on the "never again" list ...

[junh]

How likely is this deal going to go through?

[peat]

How likely is this deal going to go through?

that's the crunch eh junh?
reasonable arbitrage available for those willing to take the risk

[BlackPeter]

Plateauing now for some time, but one year chart certainly does not look inspirational. My question today is however - did the analysts predict this underperformance one year ago?

ABA's shareprice peaked in February 2019 at $6.51 and analysts (consensus) forecast for February 2020 was $8.59, which means analysts predicted the SP to go up. They have been wrong - the ABA shareprice in February 2020 actually peaked at $5.39, i.e. instead of the forecasted rise of 32% did punters get a 17% drop. Ouch.

Looking into the consensus buy recommendation - it was in February 2019 an "Outperform"(7.5/10) - i.e. analysts said that the share will outperform the NZX. This prediction was wrong as well, while the NZX went up by 21% did ABA drop by 17% (i.e. ABA underperformed over the last 12 months the NZX50 by a woeful 38%.

Both consensus predictions (price as well as comparative performance to the NZX50) have been in this case clearly wrong and anybody relying on the analyst consensus in this case would have lost heaps of money.

I am doing this exercise as well with other NZX listed stocks - the overview is here:
https://www.sharetrader.co.nz/showthread.php?11721-How-good-are-the-forecasts-of-stockmarket-analysts

11 stocks checked so far (checking for each consensus and buy recommendation);
Consensus shareprice forecasts correct: 1/11; analyst hitrate: 9%
Consensus recommendation vs NZX50 correct: 3/11; analyst hitrate: 27%

[BlackPeter]

Just noticed the announcement for the special meeting - looks like OIO happy and takeover will go ahead (obviously subject to SH approval).

Interesting is the notice re catering ... I suppose ABA will be in that regard a trailblazer for future Covid-19 SM's and AGM's:


Given the unusual circumstances around COVID-19, Abano is taking precautionary measures for the meeting including:
Every attendee at the meeting will be required to provide their contact details
There will be access to hand sanitiser both outside and inside the meeting room
There will be no refreshments served before or after the special meeting in order to limit social contact amongst a large group of people.

No need anymore to join these meetings for the delicious food :), but who knows - maybe it is possible to pinch a bottle of hand sanitizer or two?

Sign of the times ...

[peat]

Just noticed the announcement for the special meeting - looks like OIO happy and takeover will go ahead (obviously subject to SH approval).

Interesting is the notice re catering ... I suppose ABA will be in that regard a trailblazer for future Covid-19 SM's and AGM's:




No need anymore to join these meetings for the delicious food :), but who knows - maybe it is possible to pinch a bottle of hand sanitizer or two?

Sign of the times ...

Sounds very joyless not having any catering.
Are we sure there is no withdrawal possibility on this t/o?

[winner69]

Virus making life hard for dentists ...and screwed up the takeover ....if it goes ahead it will be way less than $5.70

[BlackPeter]

Virus making life hard for dentists ...and screwed up the takeover ....if it goes ahead it will be way less than $5.70

True, apparently - they are running out of masks. Horders bought them all up. Isn't it interesting to see the scum of humanity coming out of from under their rocks?

Still - not sure why it is that difficult for industry to ramp up mask production ... for sure - any marketing person worth their salt must have realized latest end of January that all sort of medical masks will be in high demand soon.

[junh]

True, apparently - they are running out of masks. Horders bought them all up. Isn't it interesting to see the scum of humanity coming out of from under their rocks?

Still - not sure why it is that difficult for industry to ramp up mask production ... for sure - any marketing person worth their salt must have realized latest end of January that all sort of medical masks will be in high demand soon.

Chinese factories make the raw materials for the masks.

[Joshuatree]

"• The Scheme Implementation Agreement with Adams NZ Bidco Limited has been terminated as a Material Adverse Change has occurred. Both parties have agreed they have no other liability to each other, as a result of the termination." NZX

[whatsup]

Virus making life hard for dentists ...and screwed up the takeover ....if it goes ahead it will be way less than $5.70

Slipped this week from $1-70 down to $1-17 atm, IF they go under .75 they are one of the best buys on the N Z X , imho.

[BlackPeter]

Slipped this week from $1-70 down to $1-17 atm, IF they go under .75 they are one of the best buys on the N Z X , imho.

Not sure I'd agree. Cheap does not mean that they are a good buy.

Their latest balance sheet (Nov 2019) looked already pretty unhealthy - lots of debts (debt to liabilities 68.5%) and the assets only hold up by plenty of quite questionable goodwill. Might be worth Zilch these days.

NTA is a big red number and current assets are minute (well, have been in November 2019 and I suppose they found little ways to increase their cash during the lock down).

Share price has been only holdup by the takeover promise .. and I see why the suitor (Bidco) decided to drop them like a hot potato - well, at the agreed price. They might get anything interesting much cheaper when they buy from the liquidator / receiver.

Not sure though whether there will be lots of fun for share holders, no matter how cheap they buy in.

[silverblizzard888]

I'm sure if shareholders said they will sell at $3 a share a takeover would happen in a heartbeart, thats enough of a safety net for me to start a position.

Though Harbour asset management really trying their best to sell this thing down.

Harbour Asset Mgmt:

3 April from 13.261% to 11.498%

7 April from 11.498% to 10.241%

15 April from 10.241% to 7.926%

16 April from 7.926% to 6.143%

[Nigel]

I'm still expecting something to come from the takeover. I don't think they will walk away completely. Despite Harbour Asset Management selling down, there seems to be considerable support (rising nicely from the lows). If Bidco are still sniffing around for a lower-priced transaction, there's a decent premium still to be made here.

[silverblizzard888]

Good bye Habour Asset Mgmt

6.143% to 3.192%

If they have been selling down this crazy and the share price has still managed to go up, prepare yourself everyone it'll do just fine next week

[nztx]

I'm still expecting something to come from the takeover. I don't think they will walk away completely. Despite Harbour Asset Management selling down, there seems to be considerable support (rising nicely from the lows). If Bidco are still sniffing around for a lower-priced transaction, there's a decent premium still to be made here.

Reading one of their announcements - it seemed like something could still land on the table

[silverblizzard888]

Looks like the last game in town for people seeking gains on sold down stocks. Up over 10% each of the last two days with no slowing momentum.

[Dlownz]

Is anyone watching the movement of albano this morning. Wow up 10% early on and now coming crashing down below yesterday's close. Lots of profit takers out there.

[Filthy]

Is anyone watching the movement of albano this morning. Wow up 10% early on and now coming crashing down below yesterday's close. Lots of profit takers out there.

yeah it has been an interesting morning. a big seller wants out.

[Dlownz]

There's been a bit of a game of one person putting a sell order on. Then someone putting a lower sell order. The the other cancelling and replacing a lower order. Rinse and repeat.

[Dlownz]

Just hit the bottom and the big seller has been gobbled up. Got what I wanted out of that after the nzx slow market transfer cost me my in the other day.

[silverblizzard888]

Like all things if it moves up quick some will be quick to take profit, especially some of the older holders.

Looks to have bottomed and buyers are accumulating.

Stock market 101 buy low sell high, it never changes

[Manukatana]

what was the reason for it to go up so much recently in this market? why dental industry??

[carrom74]

I am expecting a mad rush to the dentists as soon as the lock down gets lifted(including me)

https://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=12326585

May be good news for Abano...

[Filthy]

what was the reason for it to go up so much recently in this market? why dental industry??

this recent announcement: https://www.nzx.com/announcements/351879 plus this snippet:

"while Bidco elected to terminate the Scheme, Bidco and its principals remain engaged with us and haveindicated that they are willing to explore whether there is an alternative potential transaction"

means the deal is not totally dead in the water.
my guess is another offer will come through.
It'll be way lower than the $5.70 though (which is fair in the current climate).
maybe something around $4 bucks?? would punters take this though?

[BIRMANBOY]

Until 2020 it was a reliable dividend payer 21 cents per year and up...Dental industry is pretty solid usually one would think. SP at end of 2019 was 5.10 so accumulating at these prices doesnt seem like a bad idea if one believes that normality will resume at some point. Current buying at 2.42 , if dividend is back to normal in a year or so would mean 10% +/- dividend yield and or plus probable recovery in SP. maybe some of the reasons.
what was the reason for it to go up so much recently in this market? why dental industry??

[Sideshow Bob]

I am expecting a mad rush to the dentists as soon as the lock down gets lifted(including me)

https://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=12326585

May be good news for Abano...

Article on TV1 news tonight about dentists and challenges they are facing, and how long they were out for. Based on the dental councils recommendations, they estimated the PPE used to for each patient was going to be $80..... :scared:

[lctham]

so what do we make of the recent spike in share price? confidence back in dental??

[thegreatestben]

I wish I'd bought more, $2.80 put me at 100% gain.
Must be elimination and level 1?

[Not The Chosen One]

This has been my best performing from my small portfolio. About 140% gain since I snapped them up in March. Could say that about a lot of shares I never purchased then but I can't complain

[Cadalac123]

Why are people correlating share price movements to random little news events? You realise institutions buying and selling moves the share price right? not your speculation on level changes or how you think dental practices are affected.

There is also a large unfilled gap from a TA perspective probably being filled.

[Not The Chosen One]

Why are people correlating share price movements to random little news events? You realise institutions buying and selling moves the share price right? not your speculation on level changes or how you think dental practices are affected.

There is also a large unfilled gap from a TA perspective probably being filled.

Does it bother you that much? You do realise that people comment on every thread about events that may or may not affect movements. Or is it because of the lack of posts by the likes of myself and the previous 2 posts that made you say that? Either way, your comment didn't help much.

[Cadalac123]

Does it bother you that much? You do realise that people comment on every thread about events that may or may not affect movements. Or is it because of the lack of posts by the likes of myself and the previous 2 posts that made you say that? Either way, your comment didn't help much.

Not really bothered, just surprised at some of the posts these days and I can't tell if it's people trying to ramp up their stocks on the board (not that retail investors would meaningfully change the price anyway) or if people genuinely think the price changes are directly related to news articles which happen to be posted on the same day as the stock price changes/around the same time.

I'll give you an example. DOW goes down, CNBC starts talking about how an article on X is the reason it went down today. DOW goes up CNBC talks about an article on X is the reason it went up today. Let's zoom out and realise markets fluctuate and the up and downs on those days were probably meaningless fluctuations, yet strong correlations are being made by these news agencies to sell content on a daily basis.

I actually don't even know why I bother to challenge this. Not like I can disprove anything anyway and you are free to think whatever you want

[Akane]

... You realise institutions buying and selling moves the share price right? not your speculation on level changes or how you think dental practices are affected.

...


This pretty much sums it up, you can be 1 step head, or 2 - 3 steps at best, but the institutions will just blow everything out of the water, us retail holders mean very little in terms of swinging the price.

[peat]

Did you know that Toothbrushes now have BlueTooth. I find that kind of amusing

11657

11656

[littletramp]

a large unfilled gap from a TA perspective probably being filled[/U].

No pun intended here, on the ABA thread?

[Nigel]

$3.56 now. Are we on our way back to the $5 pre-COVID levels? Maybe the much-anticipated transaction is getting close. Hold on tight!

[thegreatestben]

Bought a very small amount of these at $1.40, kicking myself as I thought about buying 10x more at that price. >$5 would be nice in any case.

[lctham]

geez whats happening today?!

[Nigel]

Last night's announcement + the Dow Jones falling 6.9% overnight = traders got spooked.

Many stocks heading up again now. My main ASX investment fell 15% today but has now recovered to be even for the day (glad I bought more near the day's lows).

Will be interesting to watch the DOW over the coming days. Futures up 1% as I write.

[nztx]

AFR's Street Talk Rumour mill suggests bidder back at table

However ABA caned AFR's speculation back in September 2019 on other rumours

What does Mr Market say ? Maybe .. or maybe not ?

[nztx]

Bought a very small amount of these at $1.40, kicking myself as I thought about buying 10x more at that price. >$5 would be nice in any case.


Considered it back then too for a free ride, but didn't move unfortunately

Couldn't believe where SP was a few days ago

[lctham]

takeover talk reignited. Shares in trading halt. What do we think the new offer could be?

[bulltrap]

Trading halt announcement refers to "speculation in the media this morning".

I've googled but came up blank. Does anyone have 'inside information' on what the media was speculating?

[Baaarney]

A post on the Sharesies Share Club facebook referred to a NBR report that negotiations between Australian private equity firm BGH Capital, Ontario Teachers’ Pension Plan and NZX-listed dental practice operator Abano Healthcare are in full swing with a decision imminent on the latest takeover proposal

[Not The Chosen One]

This came out last week - https://www.afr.com/street-talk/bgh-capital-puts-get-out-of-jail-card-to-abano-20200611-p551i2
Negotiations fell through back in March so it looks like they're back again for another attempt

[bulltrap]

Trading halt now lifted, announcement mentions NBR article and potential offers at $3.00 or $3.25 per share.

Market not impressed, price fell from $3.30 before halt to $2.94 last check.

Me not impressed also, down so much from the earlier retracted offer, yet dental isn't exactly discretionary spending and should claw back COVID-19 impact.

Disc: nervous holder

[bulltrap]

Maybe this is the article in question: https://www.nbr.co.nz/story/abano-deal-returns-dead

According to Google it's from May 14th, but maybe it's had some updates today.

It's paywalled and they don't take ABA.NZ as payment, so I'm out of ideas.

[percy]

There are 26,282,238 ABA shares on issue,which at $2.96 gives a market cap of $77,795,424.
Raising the required $50mil to $70mil, just to stay in business, will be difficult,so any takeover above the current share price will be appealing [and best outcome] for shareholders.

[winner69]

There are 26,282,238 ABA shares on issue,which at $2.96 gives a market cap of $77,795,424.
Raising the required $50mil to $70mil, just to stay in business, will be difficult,so any takeover above the current share price will be appealing [and best outcome] for shareholders.

That $9 plus offer a few years ago must still haunt the Board

[King1212]

Ouch....saw on the newbies Facebook...plenty of them bought ABA ...reconk it was too cheap....pre covid $5 ish

[winner69]

Last capital raise a few years ago was well supported ...over $8 from memory.

[winner69]

Don’t want to sell the company do they ....hang in there long term adding shareholder value as they go

[Sideshow Bob]

Don’t want to sell the company do they ....hang in there long term adding shareholder value as they go

Not surprising they have rebuffed them, as SOA was at $5.70 previously, was accepted and come back a couple of months later at much lower price, post C19. Just now how much existing holders will like having to pony up something close to the current market cap in a capital raise! :scared:

[SSB11]

This has dropped significantly over the last week, and looking at the release that may have caused it, there is nothing too bad in there.. It says we wont accept the low ball offer and will look at other funding options, but then it also says business is picking up very well.. yet it has dropped nearly 30%. I think this could be the 'bottom' and it returns to some form of normal around 3.00, which is a ~17% higher than today's price.. Anyone else have some thoughts? similar or to the contrary?

[winner69]

This has dropped significantly over the last week, and looking at the release that may have caused it, there is nothing too bad in there.. It says we wont accept the low ball offer and will look at other funding options, but then it also says business is picking up very well.. yet it has dropped nearly 30%. I think this could be the 'bottom' and it returns to some form of normal around 3.00, which is a ~17% higher than today's price.. Anyone else have some thoughts? similar or to the contrary?

If you think the new normal is around 3 bucks go for it

But their financial performance over recent years speaks for itself and is reflected in what’s happened to the share price


Take on (acquire) more practices for diminishing returns seems to be their modus operandi

That puts me off them

Share price going well today ...hope you on board and not missing out.

[Sideshow Bob]

Also the prospect of a capital raise.....which is near enough to the current market cap....;)

[winner69]

Sales growth gradually declining .... margins steadily declining .....diminishing returns on invested capital .... and as returns way below cost of covering cost of capital they are destroying economic value (value destrucyion in high finance)

That's why i find it hard to turn interest into real enthusiasm

[Cadalac123]

Complexities are added to the scenario when you try investing in companies like ABA which are in the periaquisition timeline. Some had hopes of re-takeover offer being brought back to the plate probably, and with the contrary being recently suggested that might sway against the thoughts of some big holders.

Furthermore, you need to ask yourself how you're landing on your value of $3. How the market prices this isn't always going to correlate with historical prices. $3 could be a huge bargain or a overpriced value - I hope you aren't just looking at a gap on the chart and making a conclusion based on that (unless you like TA short-term trading which is heavily dependent on general market direction which isn't too great right now, if you were hoping for a gap fill play which tends to be led by a strong healthy uptrending market).

Growth in companies like ABA over time is also complicated and it's not a simple business structure.

[winner69]

ABA only good for short term trades I reckon ....taking the odd punt here and there.

I’ve mentioned why financials say not worth much. The chart also says why bother unless you are punter

ABA ...diminishing financial returns on capital ....and diminishing returns for share holders it seems

But heck ssbn go for it if you feel lucky......I have to keep telling myself NO NO winner not an ‘investment ‘ and punting for a quick buck ABA don’t appeal

[winner69]

Cadalac .... periaquisition is an interesting word

[Cadalac123]

Cadalac .... periaquisition is an interesting word

I’m creating my own dictionary of words to integrate into the investing world

[Entrep]

If they managed to destroy value during a boom, why invest during hard times?

[SSB11]

Thanks all for the comments. Although I do my own research and have my own opinion, i'm also open enough to take on board options of others. That's the benefit of communities like this.

[Filthy]

https://www.nzx.com/announcements/355364 - hopefully it is an improved offer.....

[Nigel]

Good move putting that message out. It might get the two parties bidding against each other, and also draw out any other potential bidders.

[winner69]

This has dropped significantly over the last week, and looking at the release that may have caused it, there is nothing too bad in there.. It says we wont accept the low ball offer and will look at other funding options, but then it also says business is picking up very well.. yet it has dropped nearly 30%. I think this could be the 'bottom' and it returns to some form of normal around 3.00, which is a ~17% higher than today's price.. Anyone else have some thoughts? similar or to the contrary?

Hope you are on the rocket ship ssb

Might get to 350 to 400

Always a few greater fools out there to take on dogs ...hope this one works out for them

Good stock for punters

[youngatheart]

Surprised that there's not much more discussion around these two competing bids. Isn't this the stuff of dreams for holders,? LoL

[Getty]

If this company was worth a buyout at $5.70 a share pre covid, it must still be worth say $3.85 mid covid?

[JSwan]

If this company was worth a buyout at $5.70 a share pre covid, it must still be worth say $3.85 mid covid?

The market is pricing in the potential of a capital raise by the company as announced numerous times on NZX

[Getty]

Indeed, but the crowd who were prepared to pay $5.70 recently, & others, must be considering a revised offer, similar to MET.
ABA has already stated there are a couple of options come forward, apart from capital raising.

[JSwan]

Indeed, but the crowd who were prepared to pay $5.70 recently, & others, must be considering a revised offer, similar to MET.
ABA has already stated there are a couple of options come forward, apart from capital raising.

That's true, however from ABA's last announcement ABA implied that the current offers weren't attractive enough for them/for the shareholders, so the market assumes that they're prioritising on that capital raise for now. Although never say never, a more attractive bid may come later on :)

[x2rider]

That's true, however from ABA's last announcement ABA implied that the current offers weren't attractive enough for them/for the shareholders, so the market assumes that they're prioritising on that capital raise for now. Although never say never, a more attractive bid may come later on :)

I would of thought if they were considering offers that it would of taken less time than it has or at least they would of advised the market of the offer prices but rejected them and moved on . My bet now is they will be continuing with a capital raising which has turned a short term hold into a longer one

[Filthy]

Pretty quiet so far.... Would've expected some news by now (with all of those weekend meetings)... I guess it takes a bit of time to put together another Scheme of Arrangement booklet though eh... then have some expensive lawyers make sure there are some words in there somewhere, so it doesn't collapse on any uncertainty this time. FWIW, I have a good mate who is a lead dentist at a Lumino. Reckons they cant get punters through the door fast enough. Huge backlog of patients since lockdown. His team have had to do extra hours and revenue at his particular practice is well up.

[Getty]

All's gone quiet on this front.

Is ABA due for it's 'Waterloo', or will it be a case of 'The winner takes it all'?

[flyinglizard]

Just waiting for the announcement, either ABA issues its new share plan or a final bid from BGH Capital and Canada pension fund.

[Getty]

I see this co as having morphed from an over priced lemon, to a sweet cherry.
There cant be too many ready made chains of dental practices all assembled with branding, systems, and professionals in place, ready for 1 buyer to take out.
People's teeth haven't stopped rotting mid Covid, full speed ahead post Covid.

[flyinglizard]

JENNY RUTH: Shareholders suffer an information deficit in schemes of arrangementhttps://businessdesk.co.nz/article/jenny-ruth-shareholders-suffer-an-information-deficit-in-schemes-of-arrangement


Abano Healthcare's board has held 52 meetings since July last year, in addition to its normal monthly meetings, to deal with various schemes of arrangement.

I take a wild guess that other bidders are Zug-based partner group, Jangho Group.

[Not The Chosen One]

Anyone know when the full year report is coming out? All I could find was something on their website saying August but no specific date mentioned.

Maybe all those meetings are taking up their time to inform anyone.

[flyinglizard]

Anyone know when the full year report is coming out? All I could find was something on their website saying August but no specific date mentioned.

Maybe all those meetings are taking up their time to inform anyone.

It says on 31th of Aug, next Monday.

[Getty]

JENNY RUTH: Shareholders suffer an information deficit in schemes of arrangementhttps://businessdesk.co.nz/article/jenny-ruth-shareholders-suffer-an-information-deficit-in-schemes-of-arrangement


Abano Healthcare's board has held 52 meetings since July last year, in addition to its normal monthly meetings, to deal with various schemes of arrangement.

I take a wild guess that other bidders are Zug-based partner group, Jangho Group.

Ah so!, the Jangho Group!
Couldn't be any worse than the current Gung-Ho group!

Dr JPG.

I don't do DENTAL, but I do DENT ALL wallets.

[trader_jackson]

Takeover offer back on at a 70% premium
https://www.afr.com/street-talk/abano-healthcare-locks-in-70pc-premium-for-new-takeover-20200829-p55qjf
A great get out of jail card.

[Not The Chosen One]

Takeover offer back on at a 70% premium
https://www.afr.com/street-talk/abano-healthcare-locks-in-70pc-premium-for-new-takeover-20200829-p55qjf
A great get out of jail card.


Also here to read. From my point of view, bloody good to see - https://www.nzx.com/announcements/358936

[Akane]

So what's everyone doing on this one? Time to move on or staying till the end?

[Filthy]

So what's everyone doing on this one? Time to move on or staying till the end?

worst case $3.70, best case $4.45. Paid in Dec. I guess you just have to weigh up the chances of one or all of the events occurring. And how quick you need the cash.
A good way of doing it though. Fair to both parties.

[Not The Chosen One]

I should say that I got in at $1.20 in April while others may potentially hold shares at $5 plus (from prior to April) so will certainly have a different viewpoint to me on the latest news

[Getty]

If this company was worth a buyout at $5.70 a share pre covid, it must still be worth say $3.85 mid covid?

Looks like I was right, something to get your teeth into...

Dr JPG

Free WINz quotes for LOSErs

[Nigel]

Interesting to see people selling below the $3.70 minimum takeover price. These sellers either desperately need money right this second, believe that the SIA will fall over, or haven't read the announcements.

[Gregnz]

Interesting to see people selling below the $3.70 minimum takeover price. These sellers either desperately need money right this second, believe that the SIA will fall over, or haven't read the announcements.

Doesn’t surprise me when people can’t access the NzX website to read the press release.

[Akane]

worst case $3.70, best case $4.45. Paid in Dec. I guess you just have to weigh up the chances of one or all of the events occurring. And how quick you need the cash.
A good way of doing it though. Fair to both parties.

And the current trade price is dead smack on $3.70, people selling are assuming the SIA will be fully discounted, people buying are aiming for $4.45.... sounds like we can't lose by holding instead of selling at $3.70, unless you need the money right now.

[Chuckles]

What would the chances be of BGH Capital being successful in the takeover bring Abano over to the ASX seeing as they are based out of Melbourne, Australia?

[Rep]

What would the chances be of BGH Capital being successful in the takeover bring Abano over to the ASX seeing as they are based out of Melbourne, Australia?

BGH are doing this deal alongside Ontario Teachers Pension Plan (OTPP) and it's a full takeover under a scheme of arrangement.
It's unlikely as a part of this transaction that Abano would move from the NZX to the ASX as there would not be any further shares remaining on public issue. Notwithstanding that Bidco could ultimately divest via an IPO later.


BGH has already acquired a number of medical centres from Healius in Australia - a number that contain dental practices within them.

OTPP has previously been the majority shareholder in one of the largest dental businesses in the US, Heartland Dental Care but sold part of its holding and the majority stake in doing so to KKR in 2018.
Heartland was the first US DSO to surpass the 1,000 supported practices mark in 2019.

[winner69]

And the current trade price is dead smack on $3.70, people selling are assuming the SIA will be fully discounted, people buying are aiming for $4.45.... sounds like we can't lose by holding instead of selling at $3.70, unless you need the money right now.

Seems that punters selling now are saying that there is a very high chance of a pandemic impact (lockdown) in NZ, NSW and Queensland before December

[Sideshow Bob]

Seems that punters selling now are saying that there is a very high chance of a pandemic impact (lockdown) in NZ, NSW and Queensland before December

Or more like they think ABA will **** it up somehow.....

[Akane]

Seems that punters selling now are saying that there is a very high chance of a pandemic impact (lockdown) in NZ, NSW and Queensland before December

I guess the mentality is a dollar today is worth more than a dollar tomorrow. They're selling and cash up so they can invest elsewhere. Fair call.

I am riding this till the end, my aim to get at least $4.20 per share :)

[calledone]

What if another buyer comes in with a higher offer? Can Abano reject this current offer?

[winner69]

I guess the mentality is a dollar today is worth more than a dollar tomorrow. They're selling and cash up so they can invest elsewhere. Fair call.

I am riding this till the end, my aim to get at least $4.20 per share :)

So you expecting a couple of lockdowns.

My point really was the ABA share price is a proxy betting market for pandemic events

[Akane]

So you expecting a couple of lockdowns.

My point really was the ABA share price is a proxy betting market for pandemic events

I am expecting some form of discount, not all of them but my guesstimate is that the price will hover $4 - $4.20.

I won't be expecting the interim share price to rise higher, until we're closer to December when there's more certainty, unless the legal side of things block this, it will not go lower. If the courts clear this, it'll edge up as we are closer to December and less chance of a lock down. There's no right or wrong to sell lower at the market price or wait and see if there's a higher price, you can take your money now and put it on CBD and probably get more money, if the show goes on that is :)

[flyinglizard]

11909

Look at this, majority of CEOs have 20%-50% cutting on annual salary. Mr. Richard has a 20% salary lift with ****ting earning to shareholders. His compensation is above NZ listed market by more than 100% since 2019, where the bids started.

You never know what is behind, $3.70-$4.45 per share make me laugh. The previous bid was $5.7. Then pandemic started, the risk premium already reflect in SP drop.

Why the management team back the current bid? haha

[Chuckles]

BGH are doing this deal alongside Ontario Teachers Pension Plan (OTPP) and it's a full takeover under a scheme of arrangement.
It's unlikely as a part of this transaction that Abano would move from the NZX to the ASX as there would not be any further shares remaining on public issue. Notwithstanding that Bidco could ultimately divest via an IPO later.


BGH has already acquired a number of medical centres from Healius in Australia - a number that contain dental practices within them.

OTPP has previously been the majority shareholder in one of the largest dental businesses in the US, Heartland Dental Care but sold part of its holding and the majority stake in doing so to KKR in 2018.
Heartland was the first US DSO to surpass the 1,000 supported practices mark in 2019.

Thank for your response :)

[Filthy]

All this potential extra dental awareness & care will hopefully will see a bit more money flow into the sector.
Just in time for the new owners to cash in eh....

https://www.rnz.co.nz/news/political/427138/labour-to-pledge-increase-in-emergency-dental-grant-from-300-to-1000
https://www.rnz.co.nz/news/political/426084/national-announces-30m-childhood-dental-services-policy
https://www.greens.org.nz/health_policy

[Filthy]

2.5 months away from implementation. obviously still a few more hurdles to jump through, but surely looking slightly less risky than a month ago looking at the deduction events.
not much movement in the share price since the start of the month, so no upside priced in yet, with a potential of up to ~17%
& worst case, the SA falls through (via vote or court), go through a cap raise and then look at the growth from potential new gov policy.
this vs the opportunity cost of using funds elsewhere in the short term. hmmm.

[Getty]

mmm, trading halt, superior t/o offer maybe?

[calledone]

What if another buyer comes in with a higher offer? Can Abano reject this current offer?

Hope keeping half my previous holding turns out to be wise move! Or will it turn out to be a wise move to sell half lol!

[Getty]

Going by the buy /sell offers /volume from yesterday, you may have called a good one

[winner69]

One thing with Abano is anything could be happening

But I reckon good for shareholders this time:t_up:

[Getty]

the announcement will come out at tooth hurty








2.30

[humvee]

still no announcements

[Akane]

still no announcements

Well, he said 2:30, but didn't say which day :D

[Dassets]

My guess is either the bid is pulled or one of the price reduction mechanisms has been activated by the bidder. My hope is the later. It looks like the permanent reduction in EBITDA adjustment (due to the aussie super issue) a likely candidate ie a 55 cent drop. What is weird is everything that was known prior to doc date was meant to be excluded. Let's see.

[Watchful]

My guess is a little different. (although I’ll freely admit I’m well out of my depth and there are many many possibilities)

Based on the halt being first thing on the 8th, there was a key date in the scheme implementation agreement, expected to be the 7th, when the scheme booklet including independent advisors report was due to be approved by takeover panel, and letter of intention issued.

I’m considering the possibility that the independent advisor’s valuation range may have come back with the minimum value above the offer price - which was to automatically trigger a good-faith negotiation period between the parties of a minimum of 48 hours from notification.

A price below the minimum doesn’t necessarily derail things, but there was wording to the effect of the directors would have to reasonably assume that shareholders would approve it still, to accept it.

I feel that if one of the price reduction triggers had been pulled, there wouldn’t have been so much of a delay, as the conditions and outcome are fairly fixed there.

I feel like I also read something to the effect of - if there is a trading halt for 5 consecutive days, they are considered to be delisted (Solely in the context of the agreement) which also triggers one of the few break clauses. This was just from a quick glance though, so may have that out of context. Will start getting nervous if the halt extends into Wednesday though..

Just my 2c, although probably not worth even that much..

[Mel]

Announcement on the bid is expected some time this morning

[humvee]

Announcement on the bid is expected some time this morning

Im guessing that must be in ABA timezone - because its not NZ timezone

[winner69]

Im guessing that must be in ABA timezone - because its not NZ timezone


Be patient ...somebody said tooth hurty

[Habits]

Be patient ...somebody said tooth hurty
The wait is as painful as the high pitched screams of a dentists drill

[winner69]

The wait is as painful as the high pitched screams of a dentists drill


Good things come to these who patiently wait

[Getty]

not long to wait now boys.
If its getting too painful, try a bit of Hartley Atkinson's Maxigesic...

[calledone]

not long to wait now boys.
If its getting too painful, try a bit of Hartley Atkinson's Maxigesic...

Should keep the Maxigesic for after the announcement lol!

[Getty]

It will be something to get ya teeth into..

[Habits]

Good things come to these who patiently wait
Very true but hopefully the trading halt will be lifted before the coalition negotiations are resolved and we all know how long those take... the board should at least keep shareholders informed.

[Getty]

relax, deep breaths, appointment times are seldom met by the professionals,
your child's pain will have gone by the time you get there anyway..

[Getty]

The delay is due to putting a bit more polish on a couple of extracts from the ann.

Morning was inserted instead of mourning apparently..

[bulltrap]

Morning was inserted instead of mourning apparently..

Well I'm kinda blue today... from holding my breath for several hours.

(sorry for breathless attempt at humour - I just needed to vent)

[Getty]

I hope the directors are taking notice.
Imagine if they buy up a chain of funeral homes, like they did with dental clinics..

[Akane]

It's out guys

[Mel]

Bid price has been increased from $4.45 to $4.75

[Habits]

Bid price has been increased from $4.45 to $4.75
Worth the wait then.. bid price up 30 cents, and share price up 50 cents. I wonder if traders think this could become a bit more competitive still

[Dassets]

Pretty happy I was wrong. Was getting nervous tbh. Well done to the directors. Looks like it it at the bottom end of the indy val hence the issue. Amazing

[nztx]

Still some outs & serious possible deductions .. in event of .. there .. check the small print carefully ;)

[Mel]

Still some outs & serious possible deductions .. in event of .. there .. check the small print carefully ;)
Agree that there is still some way to go, but I would argue that its looking more promising now given the increased bid price, following BidCo's overall review and due diligence of the proposed purchase in this latest round.

[Habits]

Agree that there is still some way to go, but I would argue that its looking more promising now given the increased bid price, following BidCo's overall review and due diligence of the proposed purchase in this latest round.
Trading 50 cents below offer which itself is one dollar under the previous... still so cheap I'm holding on

[Mel]

Trading 50 cents below offer which itself is one dollar under the previous... still so cheap I'm holding on
I'm keen to buy some more if it starts tracking lower.

[Nigel]

Thoughts on today's development?

[Sideshow Bob]

Thoughts on today's development?

Not much detail in the trading halt. Could be good or bad....

Can't trade, can't do anything about it except wait until probably Tuesday.

[Getty]

mmm, did the lifting of Covid restrictions in Auckland region give revenue a big boost, or has Australia dampened things down?

[Sideshow Bob]

https://www.nzx.com/announcements/362928

Staying in a halt....perhaps until Thursday.

[Getty]

$5.20 offer, now that eases the pain of going to the dentist

[Chuckles]

what are you holders going to do with your ABA shares? What happens after the buy out?

[calledone]

I’ve been selling in chunks on the last 3 news update. Still holding onto some.

[Nigel]

I've kept most of mine - not long now until the $5.20 deal is done (risk of the various events taking place to reduce the takeover amount is getting smaller by the day).

[Chuckles]

Thanks guys :)

[Getty]

The deal is done, as far as the s/holders have voted.
I voted for the sale too, but still another listing lost to NZX

[calledone]

https://www.nzx.com/announcements/364639

It's been a great journey following this stock.

[winner69]

https://www.nzx.com/announcements/364639

It's been a great journey following this stock.

Well done called one ..you’ve obviously done well

But many will be glad it’s all over once and for all.

[iceman]

An interesting bit of early history here from Brian Gaynor.
Not sure if it requires subscription but well worth a read over the weekend.
https://businessdesk.co.nz/article/listed-companies/abano-a-sad-adieu-to-one-time-watson-plaything

[nztx]

It looks like the Fat Lady has sung her final number & it's all over bar the tidying up:

https://www.nzx.com/announcements/365470

'22/12/2020, 9:08 am TRANSACT

Abano Healthcare Group Limited (NZX: ABA) confirms that the Scheme of Arrangement with Adams NZ Bidco Limited is now unconditional and will be implemented today, 22 December 2020.

The company has not received any notice of a Price Adjustment event and therefore Abano shareholders will be paid $5.20 per Abano share. Payment of the Scheme price to Abano shareholders as at 5.00pm on 16 December 2020, will be made today.

Abano ordinary shares will be delisted and will cease to be quoted from close of business today.'

[Akane]

Well done all LTH's, I got in with a small amount @ $1.54, got my payout yesterday, now looking for other unicorns such as this one, been a pretty sweet ride, cheers.

[winner69]

Before it disappears here's the long term ABA chart

Been a wild ride - some punters have done well and others have been burnt - and for a few maybe as loyal long term holders the $5 is a bit of a get out of jail card and relief the journey is over.

A good example of 'The market giveth but the market also taketh.

Last thought - management can't be proud of their record over the years, especially when they went down the path of corporate consolidation of hearing clinic and dental practices. ABA has had a long history of value destruction - using more and more capital for ever diminishing returns on that capital,

To those who cashed in lately on the takeover well done - a good punt eh.

[Akane]

A good example of 'The market giveth but the market also taketh.

When there's a winner, there's got to be losers. Someone has to lose money in order for you to make money.

[winner69]

When there's a winner, there's got to be losers. Someone has to lose money in order for you to make money.

Appreciate that but the the saying is a warning that when the market has given you heaps don't let it taketh away

Big increases in ABA shareprice (giveth) on ABA over the years generally followed by big falls (taketh)

Good thing this time around a greater fool (the acquiror) has giveth more and we'll take it

[Akane]

Appreciate that but the the saying is a warning that when the market has given you heaps don't let it taketh away

Big increases in ABA shareprice (giveth) on ABA over the years generally followed by big falls (taketh)

Good thing this time around a greater fool (the acquiror) has giveth more and we'll take it

Well I'm still down 40% on A2 Milk, and the small earnings I got from ABA doesn't even cover 2/3 of it since I've placed a lot of eggs in that basket.
So what you're saying rings true. Appreciate that.

[BlackPeter]

When there's a winner, there's got to be losers. Someone has to lose money in order for you to make money.

Not true. There are the "traders companies" with mediocre boards and management (like Abano) which offer a win-lose situation for the holders. For these companies timing is everything.

On the other hand are there as well great companies run by outstanding boards (like e.g. Mainfreight or FPH to name just some) where everybody is a winner (not really a timing issues).

Obviously - there are as well some companies where basically everybody is a loser (CBL or WYN) and there are some just in between ....

[Akane]

On the other hand are there as well great companies run by outstanding boards (like e.g. Mainfreight or FPH to name just some) where everybody is a winner (not really a timing issues).


Where everyone's a winner, where does the actual "money" comes from? It'll be fed from the newest investors.

[BlackPeter]

Where everyone's a winner, where does the actual "money" comes from? It'll be fed from the newest investors.

Does not mean they are losers, if the value of the company keeps climbing, isn't it? Good companies are worth what they are sold for - everybody wins ...

[Sideshow Bob]

Like alot of things in life, timing is often everything......