Unbelievable that much support at $7.5 for CEN. Blackrock got away lightly! Surprised buyers set their bids so high? I know to take advantage of picking up the low of the days trade, but at $7.50 didn't end up being much of a 'bargain'.
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Unbelievable that much support at $7.5 for CEN. Blackrock got away lightly! Surprised buyers set their bids so high? I know to take advantage of picking up the low of the days trade, but at $7.50 didn't end up being much of a 'bargain'.
Looks like shorters have been dealt to - ouch!
https://www.nzx.com/announcements/371169
Exec level cashing in (or out depending how you look at it)
'Blackrock' as a group cover a multitude of different international companies. Given this I thought it was a worthwhile exercise to look at the complete declared picture to see exactly what happened in the sell down. On record are Blackrock's declared peak holdings on 14-01-2021 and their holdings on 20-04-2021 just after the sell down.
No. Shares Held 20-04-2021 No. Shares Held 14-01-2021 Possible Shares Internally Redistributed Aperico Group LLC 177,851 (+100%) 0 177,851 Blackrock Advisors (UK) Ltd. 7,373,646 (-82.6%) 42,277,344 Blackrock Asset Management Canada Limited 260,683 (+24.7%) 209,194 51,489 Blackrock Asset Management Deutscheland AG 5,904,181 (+57.0%) 3,761,194 2,142,987 Blackrock Asset Management North Asia Limited 4,677 (+443%) 1,056 3,621 Blackrock Financial Management Inc 109,585 (+261%) 41,985 67,600 Blackrock Fund Advisors 15,979,436 (-67.1%) 48,497,377 Blackrock Institutional Trust Co., National Association 5,029,558 (-6.09%) 5,355,835 Blackrock Investment Management (Australia) Limited 6,116 (+0%) 6,116 Blackrock Investment Management (UK) Limited 2,878,563 (+1.94%) 2,823,728 54,835 Blackrock Investment Management LLC 9,634 (+427%) 2,255 7,739 Blackrock Japan Co. Ltd. 30,101 (+0%) 30,101 Blackrock Netherlands BV 0 (-100%) 97,535 Total Percentage Holding 4.866% 14.349% Total Holding Possibly Redistributed Internally 2,506,122
The above table does not take into account the number of shares subscribed to in the $400m cash issue. Such shares were issued on 16th February 2021. The $400m raised from institutional shareholders was from a total pool of $475m raised, with $400m representing proportionately the institutional shareholder base of Contact Energy. In the 16th April press release Contact said:
"All existing eligible institutional shareholders who bid for their pro-rata allocation of the Placement were allocated at least that amount of new shares."
Before the cash issue there were 718,565,905 shares on issue.
The representative institutional shareholder component of that was:
400/475 x 718,565,905 = 605,108,130
The total number of new shares issued to institutions at the tender price of $1.70 was:
$400m / $4.70 = 85.106m new shares
This represented 85.106 / 605.109 = 14.06% of the pre-existing CEN shares in this owner group. So we can assume that any Blackrock group company that wanted to increase their holding of shares could have boosted their holding by this percentage, if they had wanted to do so.
There is no evidence in the above table that any of the Blackrock companies took up their entitlement to the maximum. Indeed it would be kind of dumb to do so, knowing that other companies within the group were looking to sell down. So my guess is there was an internal redistribution, of up to 2,506,122 shares from Blackrock's ESG fund, into some of their other funds.
I had assumed that the Blackrock ESG fund, which was doing the sell down, was purely US based (it looks like as 'Blackrock Fund Advisors'). However, the very large sell down by 'Blackrock Advisors UK Ltd.' would suggest that perhaps some of that fund was UK domiciled? In any event the number of shares sold by those two aforementioned funds totalled 67,421,639 shares. That is far more than I suggested may have been redistributed and reabsorbed by other arms of Blackrock.
On 22nd April Milford Asset management issued a notice to say that they had bought 25,010,276 CEN shares 'on market'. The timing of this transaction would suggest that those shares were bought from Blackrock. There have been no other institutions declaring they have bought a significant stake since. So my guess is that the remaining 50m odd shares that Blackrock disposed of went to other institutions in such a way that no other institution broke the 5% share ownership threshold that required a declaration.
SNOOPY
Very informative thank you Snoopy.
So all said and done do you think that Blackrocks internal redistribution will subsequently be slowly sold down over its subsidiaries in the coming months. Putting a continued downward pressure on the SP. This obviously would be a much smarter way of selling down CEN and MEL shares rather than trying to force sell such a large quantity on 16th April.
Firstly I need to point out that I don't know if the internal share redistribution within Blackrock took place or not. I am only saying it would have been logical to do it from an overall Blackrock perspective. The problem is that although we know the names of all of these Blackrock business units, we don't know how they operate or what their objectives are or how genuinely independent they are. The 'iShares' brand under which the aforementioned ESG fund held those 'Contact' and 'Meridian' shares does not appear on that shareholding naming list. 'iShares' is literally a 'consumer brand' for Blackrock it would seem. The only thing that gives us a clue as to where those 'IShares' holdings were registered is the large drop in certain Blackrock entities' holdings on or about the date we knew those sell downs occurred.
I would assume that some of those other Blackrock companies are part of market determined index funds. Any CEN shares held within those are clearly not overhangs waiting to be sold. If the internal share transfers did occur as I suggested, then the remaining overhang is likely not more than 2.5m shares. It is not unusual for CEN to trade more than 1m shares in a day. So I am fairly sure Blackrock could feed the market any remainder into the market without severely knocking the CEN share price about.
You say that forcing a large sell down on a certain date was a poor way to dispose of a large holding and I would agree - if that is what happened. However, the fact that the share price did not collapse would suggest to me that there was a lot of behind the scenes maneuvering lining up buyers before the actual sell down registration date.
SNOOPY
http://nzx-prod-s7fsd7f98s.s3-websit...815/345560.pdf
Looks to me that the April Operating Report shows a significant increase in netback and possible future operating profit and indicates this will continue(page 2-overview looks promising ) .
Would be interested to hear more expert views on this
A very nice dividend coming. 21c is not too bad at all.