IFT - Infratil

[macduffy]

Mac , I thought that in a report somewhere that it was a fairly close call in this particular investment but with this ann they could now be out of the woods.

ENE traded at $1-56 prior to the halt. IFT look to be still well out of the money at that price -

From the 2008 IFT annual report -

Hold about 28% of ENE - 43m shares approx.
MV of the holding was $207.5m as at 31/3/07, $110.3m as at 31/3/08.
At $110.3m, this represented a "decline of $59.7m from cost".

Therefore cost to IFT was about $170m.
M/V of that holding at $1-56 = AUD67.2m approx, say NZD85m approx.

Have I got it wrong somewhere?

[Caesius]

ENE traded at $1-56 prior to the halt. IFT look to be still well out of the money at that price -

From the 2008 IFT annual report -

Hold about 28% of ENE - 43m shares approx.
MV of the holding was $207.5m as at 31/3/07, $110.3m as at 31/3/08.
At $110.3m, this represented a "decline of $59.7m from cost".

Therefore cost to IFT was about $170m.
M/V of that holding at $1-56 = AUD67.2m approx, say NZD85m approx.

Have I got it wrong somewhere?

Hey macduffy would you mind elaborating on what M/V means in this context? Cheers

[whatsup]

On the lunch time finance reportI think that a spokesman for IFT said that they would accept a price of $2.00 per share which may include a premium for control, as IFT own 32%.

[macduffy]

Hey macduffy would you mind elaborating on what M/V means in this context? Cheers

M/V or MV = Market Value.

In the case of the IFT annual report, I assume it was NZD equivalent as at the relevant dates - 31/3/07 and 31/3/08. (refer pp 23 and 68).
In current valuation, $1-56 was the last trade (AUD).

[macduffy]

On the lunch time finance reportI think that a spokesman for IFT said that they would accept a price of $2.00 per share which may include a premium for control, as IFT own 32%.

According to "The Age", ENE have 154.2m shares on issue so 32% would be 49.3m shares, at $2 per share, $98.6m.

I assume he meant AUD2? But still a fair way short of the cost price.

[whatsup]

Mac ..., any idea as to why the increase in the P M today up in a other wise dull day, Aussie closed today as well.

[macduffy]

Mac ..., any idea as to why the increase in the P M today up in a other wise dull day, Aussie closed today as well.

IFT wrote down the book value of its investment in ENE by $113.7m in the last year to 31/3/09 so it will recoup some of this if it sells at $2 - AUD or NZD - and will show a "profit" on the investment in the current year.
Won't alter the fact that ENE has cost them a lot of money, capital and income foregone, over the past few years.

[COLIN]

Great Toddy , now we will have a new class of warrant listed from 11/07/09 a "Partly paid, $ 1.12 , 21/05/2010 Warrant" !!!.

With IFTWB being back in the money again, and trading at slightly below the heads, seems to me they offer an attractive opportunity for anyone intending to buy into IFT - whose sp is in a recovery mode and the company will be able to strengthen its capital position further with the warrants now likely to be mostly exercised - an outcome which a couple of months ago the company seemed to be accepting was an unlikely outcome.
(For those not fully acquainted with the position, effectively an IFTWB holder will be entitled to one IFT share for each warrant, for payment of only 55c next month, and a further $1.12 in almost a year's time, i.e. a total payment of $1.67. The current IFTWB price is 11c, so all-up it will cost you $1.78 - but bear in mind you will have the use of $1.12 of that money for almost a whole year. Compare that with today's price of around $1.73 for the head shares [last time I looked] and this seems a solid discount, given that there is every likelihood that the IFT price will be well above $2 in a year's time - those who are paying 7c for the IFTWC warrants must certainly think so, given the exercise price of $4.12 for those instruments - I would not be so optimistic as to have faith in the IFT price being above that level by 2012, but who knows!)
DISC: I have to declare an interest in that I am a holder of IFTWB - and am tempted to buy a few more.

[Toddy]

IFT has certainly had a bad run, worse than bad actually. The SP has reflected the mood of the market and one would hope that as confidence climbs then so will the IFT SP.

The timing of the B warrants exercise date could not have been more ill timed, which is reflected in the new arrangement to be voted on 25 June.

If the ENE monkey can be lifted off their back then I'm pretty confident that we can all live with the airport assets underperforming while the travel industry finds its feet again.

There is definately time for the SP to appreciate over the next 12 months to a level that fairly reflects the real risk of the IFT portfolio.

[Caesius]

Bad day for the (boring) NZX but that doesn't seem to be reflected in IFT's SP.

No announcements though. What's driving the rise in the heads?