COA - Coats Group plc (formerly GPG - Guinness Peat Group Plc)

[Lizard]

So, to make up for leaving it off the market announcement, the NZX have published it as news.

[Jay]

Investor Alert – “SELL” Guinness Peat Group (GPG)

27 August 2008

Dear Client,

Given recent news, the recommendation by IRGs Research Department is to sell Guinness Peat Group (GPG) from your portfolio.
Contact our Equity Sharebrokers on 0800 437 8489.


Equity Investment Advisers Ltd

First time I've ever got a sell alert from them in this way!
I think the current NTA is well above the share price, cannot put my finger on the value at the mo, or I might be wrong. Would depend on how much Coates is really worth?

[macduffy]

Brokers/advisers have to drum up business any way they can, especially in a dull market. I think it would be a mistake to sell a company just because the market is down, which is essentially the reason for GPG's apparently poor result.

[sideline]

[B][COLOR=#fdfdfd][FONT=arial,verdana,trebuchet ms]

.....................
I think the current NTA is well above the share price, cannot put my finger on the value at the mo, or I might be wrong. Would depend on how much Coates is really worth?

Directbroking list the NTA as 148.59cents. Don't know how reliable that is.
If paid out in 2010 it would have to be discounted now for two years, so current value would
be lower.

[Lizard]

NAV is given as NZ $1.71 per share in yesterday's report.

[living2]

GPG is not done yet, Sir Ron says
4:00AM Thursday August 28, 2008
By Adam Bennett


Sir Ron intends to step down in 2010, when he will be 74.

2008 Financial Results
Kiwibank moves closer to independence
Uncertainty is hurting us, says Vector
While the future of his $4 billion investment company may now be uncertain after he announced plans to retire in 2010, Guinness Peat Group chairman Sir Ron Brierley says the company is cashed up and still looking to do deals.

Sir Ron, a towering figure in New Zealand business who cemented his reputation as a corporate raider during the 1980s, announced his retirement plan in comments accompanying GPG's half year result yesterday.

"The board is working towards a substantial release of value to shareholders in 2010 which will coincide with GPG's 20th anniversary and my own retirement as chairman of the company," he said.

He did not elaborate on how large a "substantial release" might be.

GPG specialises in buying undervalued, underperforming businesses, shaking them up, and selling them for a healthy profit. It was acquired by Sir Ron after he lost control of Brierley Investments in the early 90s and has since been managed by a small team of former Brierley Investments colleagues, including Tony Gibbs and Gary Weiss. The company, which is dual listed in the UK and New Zealand, was originally intended to have a limited lifespan.

"If one had said at the outset it would go on for 20 years, that would have seemed unlikely at the time," Sir Ron, who will turn 74 in 2010, told the Business Herald yesterday.

Two decades was "a pretty reasonable cycle for any company, particularly one like GPG with such a small team at the top".

While yesterday's result was, according to Sir Ron, "rather poor" GPG has grown considerably over its lifetime and its various assets, including stakes in Tower New Zealand and 100 per cent of huge multinational thread maker Coats, were recently valued at $4 billion.

Sir Ron yesterday said his company had a "strong, conservatively presented balance sheet and good liquidity". That had been further bolstered by the sale of GPG's stake in Tower Australia which the Business Herald understands netted the company a £150 million profit.

All up the company was sitting on cash of about $1 billion not including various bank facilities.

Meanwhile, the company's shares have for some time traded at a sizeable discount to their net asset value.

"I reckon over the next two years we can enhance the present value quite considerably and that's what we'll be trying to do. It just seems a natural period of time and sensible to indicate where we are going and I think that's something shareholders have been looking for as well."

There had been no decision as yet on how capital will be returned to shareholders or even whether GPG would continue in its present form beyond 2010.

"That's up to my colleagues. I assume they will want to carry on in some form. Whether they want to do so in the traditional GPG way or in new entities or whatever, I just don't know. I don't think they do either."

One local analyst said yesterdays' statement was the first time GPG had signalled a capital return to investors but that did not necessarily mean the gap between the company's share price and its net asset value would close any time soon.

"Because it's still quite a way off and probably includes a period of some uncertainty around some of its other investments it may take some time. But it helps give people a time frame over which they can invest in GPG and expect a return."

GPG yesterday reported a £41 million loss for the June half against a £92 million profit a year earlier.

The company gained £15 million from "normal trading sources and sales of shares" but suffered share portfolio writedowns of £35 million. On top of that the numbers included a £22 million "deferred tax adjustment" which Sir Ron said was "purely IFRS nonsense and can be safely disregarded as a legitimate inclusion in any proper analysis of the result".

Coats, which makes up almost 40 per cent of GPG's assets, had a mixed half-year with its core industrial threads division performing well despite softer conditions in the apparel market. Coats' net profit for the June half was US$4.4 million, down from US$24.7 million a year ago.

Sir Ron yesterday singled out Australian aluminium company Capral as "an instance of arguably misplaced investment judgment".

Earlier this week Capral reported a A$12.1 million half year loss, compared to a A$19.4 million loss a year earlier.

GPG is to underwrite a A$29.2 million rights issue for the company, "in the hope/expectation that the inevitable changes in the company's trading environment are looming ever closer and our faith will be finally rewarded".

GPG shares closed 5c lower at $1.43 yesterday.

GUINNESS PEAT GROUP
Six months to June 30

Total assets
2008 - £2.14b
2007 - £2.11b

Total liabilities
2008 - £1.11b
2007 - £1.06b

Net assets
2008 - £1.03b
2007 - £1.05b

Net profit (loss)
2008 - (£41m)
2007 - £92m

[Contrarian]

Guinness Peat Group plc

Retirement of a Director

Guinness Peat Group plc ("GPG") announces that Graeme Cureton will retire as
a director of the Company on 29 August 2008.

Commenting on Graeme's retirement, Sir Ron Brierley, GPG's Chairman, said
"Graeme has worked with me and with the GPG team for many years, since 2002
as a Director of GPG. He has also represented GPG on the Boards of several
companies in which GPG has invested. We will miss his input and would like
to take this opportunity of thanking Graeme for his valuable contribution
over the years. We wish Graeme well in his retirement."

[shasta]

Guinness Peat Group plc

Retirement of a Director

Guinness Peat Group plc ("GPG") announces that Graeme Cureton will retire as
a director of the Company on 29 August 2008.

Commenting on Graeme's retirement, Sir Ron Brierley, GPG's Chairman, said
"Graeme has worked with me and with the GPG team for many years, since 2002
as a Director of GPG. He has also represented GPG on the Boards of several
companies in which GPG has invested. We will miss his input and would like
to take this opportunity of thanking Graeme for his valuable contribution
over the years. We wish Graeme well in his retirement."

Brian Gaynor wastes no time in putting the boot in...

http://www.nzherald.co.nz/section/3/...0529713&pnum=0

Note, towards the end the options Gaynor suggests GPG has.

I personally would be interested in buying back into GPG, if it floated Coats & gave GPG holders an inspecie distribution.

[zac]

I agree with Brian Gaynor's take on the GPG situation; a good analysis. What he did not mention were the implications of the CGT that shareholders are up for after the 5 year moratorium runs out.

[BRICKS]

INVESTORS you are buying at peril, with some of the Micky Mouse companies in GPG yet to talked about and impossible to SELL off lucky if the share price would make $1.00..