ALF - Allied Farmers Limited

[golden city]

The money machine is start rolling More Pipeline fir acqusition if they raise another 50m to 100m next time and keep doing it. That will be massive for Alf

[kiora]

Hmmm
Alf set to receive
:Management fee
+ Transaction fee $1,425,000
++ Lease Fees $ 420,000
Ok NZL due diligence costs included in TF & LF but who is carrying out the due diligence? ALF ?

When returns on farms are said to be around 3% on total assets I wonder what is left for NZL shareholders?

& NZL SP jumps 7%,go figure?

Ok so return on leases 5.08% before fees
"The Van Leeuwen Group was placed into receivership earlier this week by Calibre Partners, but will lease back the farms after settlement through three different companies. The lease arrangement is worth $5.8m a year, with an 11-year term and two 12-year rights of renewal".
https://www.stuff.co.nz/business/far...farms-for-114m

Not on my radar

[Lola]

The best of Farming Sticks & pasture transfers follows patterns of Succession - along lines of 'Keep it in the Family'

A long pattern of this evident

ALF elude to Drought conditions

- How many sell in a Drought environment ?

- How many would sell & lease back in a Drought ?

- How many would look to lease (long term) in a Drought ?

- How many would rather follow 'Succession steps" as referred to earlier or perhaps use the 'Family Bank" to enter the sector ?


What sort of standard would any potential NZRL buys be - given the above ?

What vast pool of Management Skillsets do ALF have now or available for their part of this add-on Scheme ?

Buying a portfolio of reasonable quality dairy properties doesn't happen overnight, nor does capturing
potential mutation of the "Sharemilker" type of participant for such properties, which NZRL are targeting as their audience

Where can I send the cutlery to help you start eating a few of your words.?

[nztx]

The Muddy Boots Empire Farm Buying Slush fund is now apparently all spent up & bare

Cap Raise all round anyone - for when the next lot of Farm Dirt hits the market (distressed or not) ?

Bound to be great for the SP & those hoping to get rich off owning blocks of Farming Dirt ..

[nztx]

Where can I send the cutlery to help you start eating a few of your words.?

The latest large scale buy up doesn't count -- obviously a captive former owner aka 'ready to pay up large on leases'
in somewhat of a distressed situation .. not as if the Muddy Boots Empire had to do too much work
to enlist & entice new willing residents willing to pay large lease money for the privilege ..

Better save up the pennies as any further buy ups may well come with a Cap Raise Ticket attached
filtering through to unfortunates holding ALF as well ..

[mfd]

The latest large scale buy up doesn't count -- obviously a captive former owner aka 'ready to pay up large on leases'
in somewhat of a distressed situation .. not as if the Muddy Boots Empire had to do too much work
to enlist & entice new willing residents willing to pay large lease money for the privilege ..

Better save up the pennies as any further buy ups may well come with a Cap Raise Ticket attached
filtering through to unfortunates holding ALF as well ..

ALF own 1.49% of NZRLC. I believe NZRLC intend to lever up at some point so more farms could be funded by debt, but let's say they go hard and want to raise another $100m. That means ALF have to knock up ~$1.5m dollars - at the half year report a few months ago they had $2.5m cash on the balance sheet, and there's at least $700k coming their way as their cut from the latest acquisition.

Worst case, if they come up short they would need to raise about 5c per share, ~8% of the market cap. Not particularly worrying. You may also remember that ALF have approval to raise up to $5m in additional placements which could be used to keep us from dipping into our own pockets.

That's not even mentioning that if NZRLC are raising capital and buying more farms, this is fantastic for ALF as it gives them more scale and they take 0.25% of NAV as a management fee. You need a scarier story.

[nztx]

NZRLC seem to have a fair bit of exposure coming on board to properties operated by one operator group
which in itself has seen past dramas - M Bovine - just a few years ago

Dairy may be humming now, but who knows what future dairy fortunes hold or the aspirations of our
resident politicians on the hill may dictate or a further slight of the hand & strike of the pen to disallow
interest deductions across all property purchases (not just Residential property as most recent mutation has done)

Any further moves towards CGT based initiatives may tend to wipe the smiles off the faces of many
should that be explored or occur at a pen stroke from those muddling & fuddling away on the hill ..

NZRL & ALF would undoubtedly be casualties, if CGT initiatives were entertained by a Govt perched
on the edge of a large 'self created' fiscal crater, moving to fill the gap..

ALF has already doubled it's capital - hints at drought, varying results from it's own livestock trading.
Large scale NZRLC buy ups may deliver one off bonus windfalls to ALF, but in the longer term
both appear to be overly overweight in interest in the NZRL interests, possibly to detriment of ALF's
other core operations, in part appearing to seasonally based.

NZRL's investment mode focused on just land in one sub sector with no diversification or
spread suggests high risk & vulnerability to fortunes to that sector exists in volatile markets,
even with just holding real estate in that sector in a passive role.

Available ALF working capital at interim maybe capital needing to be used in it's own seasonal activities, so in turn
may not be available in take up of NZRL further rights issues (if any) to even maintain their 1.49%

There is so much more issued capital needed to be covered by any dividend they may intend proposing,
limitations on windfall Management profits, with growing exposure to just one sector.

In a global stage, other countries are developing their Dairy, we see Fonterra, Synlait & ATM as possible
hints as to what can (& does) go awry with degrees of excessive exposure to any one sector or part thereof.

At the end of the day, NZRL's mode to infinite wealth some may guess must be towards to Farm Value appreciation
as time goes on, if one to assume low margins operating after Management fees are stumped up
& lesser in operating surplus if farm financing comes into play on further acquisitions with or without
possible Cap Raise in NZRL camp..

Taking on financing further adds risk to medium term interest rate rises, which may or may not be
fully recoverable in farm lease receipts

Farm value appreciation is generally linked to fortunes of the farming type itself, or those of a better
land use prepared to stump up higher values for the same land for their purposes..

It's interesting how much the market has valued up both NZRL & ALF based on announcements
of buy up of the Dairy Dirt & a good question on whether risks, exposure & possible understanding of how
the deck of cards is structured have been fully factored in ..

Discl: Not a holder & happy to be a deckchair spectator to ALF & it's Captive NZRL Management Scheme

[golden city]

Land value are always going up. Imagine if some of the dairy farm allow to develop into housing in future what opportunties will that bring It will be massive

[golden city]

For Alf. The bigger the nzrl grows the better income they will have .which looks very good if the nzrl grows into monster billion dollar portfolio funds

[kiwimalayalee]

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