SKT Sky Network Television Limited.

[mistaTea]

Why is SKT not in a trading halt on NZX while this is going on ?

Obviously it may materially affect Share Price and value of the company

In other markets like OZ this sort of thing may well trigger a halt

Probably a good question to be directed to the NZX.

Talks are said to be 'advanced' and 'exclusive'...so very far down the track despite them saying the outcome is still uncertain. Given talks have gotten this far it is fair to say that it is more likely to end in a deal than not (unless the negative media and shareholder backlash - both in terms of online forums and the fact the SP has crashed below where it was sitting even before the takeover chatter - causes the Board to make Sophie kill the deal).

But given SM is probably going to present some sort of a deal to shareholders soon...it is interesting that the shares are still allowed to trade now that you mention it.

People are dumping shares without material information being made available. And Sky can't release the terms and price until they have signed a deal with MW. So a trading halt would have certainly calmed things down and given some time for the market to digest the news, get the terms of the deal and then resume trading with a clearer head).

[winner69]

Outdoor advertising signs are pretty intelligent these days

There’s one that says ‘xxx electric vehicles have passed this spot today’ ….getting you to buy a EV

Apparently there’s a camera that can read numbers plates built in and connected to a database somewhere and so can count the number of EVs

Wonder what other stuff they can do

Cool eh

[winner69]

No need for a trading halt when this happens

[nztx]

Outdoor advertising signs are pretty intelligent these days

There’s one that says ‘xxx electric vehicles have passed this spot today’ ….getting you to buy a EV

Apparently there’s a camera that can read numbers plates built in and connected to a database somewhere and so can count the number of EVs

Wonder what other stuff they can do

Cool eh

Probably count ones visits to whatever supermarket & what your favourite Warehouse store is ?

may even be able to read your shopping list too ..

[mistaTea]

"under the current proposed transaction structure if an acquisition of Mediaworks proceeds, itwould not require Sky to raise new equity but would require approval of an ordinary resolutionby shareholders at an Extraordinary Shareholder Meeting."

transaction 'structure'...

This is my prediction...Sky will want to work this in a way that still allows them to pay out a dividend (in other words, allow The Board to keep their promise).

But how can you do that as well as make a significant purchase when you only have ~$150M cash (and require some of that as working capital)?

Well, given the wording in the notice...I think SM will announce a deal that includes part cash payment and part issuance of SKT shares. 'Transaction structure' certainly sounds more complicated than just a cash payment - and given the kind of money MW seem to be expecting, we can't afford to buy them with all available cash (even if we were happy to forgo the dividend - which we aren't).

[nztx]

As I see it:

PE sees Markets in Freefall and badly wants out of MW

Message to Sophie - Screw PE down harder than hard as .. worse than putting them through the wringer

They know there is punishment on the way

Take them captive for a ride if it must be - in form of some ongoing SKT stake - not a major one,
but enough to keep them alert, assuming that taking a Lemon on board is even feasible..

PE have few if any other viable options on where to turn to avoid wearing market carnage ..
they know that MW will likely bleed bucket fulls of Red going ahead if they stay in there as is
if MW doesn't capsize along the way.. for want of further support needing to be thrown in

[mistaTea]

As I see it:

PE sees Markets in Freefall and badly wants out of MW

Message to Sophie - Screw PE down harder than hard as .. worse than putting them through the wringer

They know there is punishment on the way

Take them captive for a ride if it must be - in form of some ongoing SKT stake - not a major one,
but enough to keep them alert, assuming that taking a Lemon on board is even feasible..

PE have few if any other viable options on where to turn to avoid wearing market carnage ..
they know that MW will likely bleed bucket fulls of Red going ahead if they stay in there as is
if MW doesn't capsize along the way.. for want of further support needing to be thrown in

Sure, but let's say SM did amazingly well and beat them down to $130M (considering their independent valuaiton seems to point to $150M, and they may want more)...

Well, if they want to do a dividend, lets say they go $80M cash payment and $50M equity. At the current low SP that would mean we give them 10% of the business as payment.

Not great given our low SP...and especially not now that Sophie and The Board have managed to drive our shares down even lower.

[nztx]

Sure, but let's say SM did amazingly well and beat them down to $130M (considering their independent valuaiton seems to point to $150M, and they may want more)...

Well, if they want to do a dividend, lets say they go $80M cash payment and $50M equity. At the current low SP that would mean we give them 10% of the business as payment.

Not great given our low SP...and especially not now that Sophie and The Board have managed to drive our shares down even lower.

I would say PE have 100 million reasons to want to navigate out of potential tight spot going forward

Most would be wanting considerably better than $20 mil to even start looking for an olive leaf, otherwise
leave then to traverse their destiny in the coming storm ahead

SKT has successfully pulled off it's own righting of the ship more or less

PE need to recognise that doing the same for their MW wont come cheap or with any free gifts
in fact hopefully with massive discounts on all the china in the cupboard - close to a liquidators sale

[mistaTea]

I would say PE have 100 million reasons to want to navigate out of potential tight spot going forward

Most would be wanting considerably better than $20 mil to even start looking for an olive leaf, otherwise
leave then to traverse their destiny in the coming storm ahead

Yeah, the other part I forgot to mention is The Board will probably want to retire a big chunk of the debt. Let's say $50M.

So even if SM could beat them down to $100M (still not a great deal imo given it is an EV of $200M)...

• $50M cash payment
• 10% of our business
• $50M debt payment
• $30M FY dividend

[nztx]

Yeah, the other part I forgot to mention is The Board will probably want to retire a big chunk of the debt. Let's say $50M.

So even if SM could beat them down to $100M (still not a great deal imo given it is an EV of $200M)...

• $50M cash payment
• 10% of our business
• $50M debt payment
• $30M FY dividend

Going forward a Lender's Debt remission in order of $25-$30m wouldn't be a lot to look for ?

So net debt assumed $25m - $30m ?

Things could pan out considerably worse & no reminders of past history needed