SUM - Summerset Group

[Anonymous]

$2.42 - which appears to be a 6.5% discount to the Friday price, as I had heard over the weekend.

I was going to ask this earlier and this may be a stupid question, and given that First NZ have offered at $2.42 also then perhaps have answered my own question, but do all brokers participating in a placement have to offer at the same price or can each broker try and 'place' it for as higher price as they think they can achieve?

I guess they would lose a fair bit of goodwill offering at a higher price than their peers...

[Joshuatree]

Not in my experience. Craigs offered a placement to me for less then an other broker recently, cant recall which share atm..

[Anonymous]

Thanks Sparky, that makes sense. I guess then Joshuatree that Craigs were underwriting that placement you got cheaper than others?

[forest]

What do posters value SUM at. I personally can not see a value anywere close to $2.40.
Remember they only grow fast because of resent new equity.(Anybody should be able to grow with new funds). Not sure if they keep this up on their own steam.
I am interested in some opinions on value.

Cheers Forest

[forest]

Sparky,I would have thought that 30% is unlikely for 5 years without extra funds. I have SUM at a PE of around 36 at current price. It wouldnt surprise me if SUM SP will come back to $2.07.
What I also notice is that this placement is carried out just before the yearly accounts are publised, maybe they are not as flattering as people expect.
We will find out in the next few weeks.

[macduffy]

They would lose enormous goodwill. If I paid $2.42 at Forbarr and First NZ could give it to me for $2.40, then I'd rather deal with Forbar.

I'd say UBS, who underwrote the sale, gets 1.5-2.5% in profit. Retail brokers get 1-2%. If Forsyth Barr get $100m allocated, then they click over an easy $1m-$2m for a weekend's work. So UBS would probably have underwritten at $2.32-$2.35 or so.

That's pretty much it, I reckon.

The shares are being "placed" at $2.42 and "trading" is currently halted. Not absolutely sure of this but I would think that participating brokers are obliged to place shares at the placement price. Of course, if they take them firm themselves and on-sell at another price once the trading halt is over, that would be a different matter?

[tosspot]

did anyone manage to get any through asb securties, im pissed I called them in the morning and they didnt know what I was talking about. they put me on hold for to long. called again later and they said we can give shares at a discount you need to buy whats on the market and by the looks of it trading is currently halted didnt know what they were talking about. then called again and the 3rd person said you needed an invite to get in on the $2.42 shares

[tosspot]

Tosspot, this is what happens when you use discount brokerage. If you don't value a broker's services, then you surely can't expect them to value your business when the opportunities come knocking.

No I dont think its got anything to do with that. I was very polite wasnt rude at all. no one new what I was talking about though. it was just the call centre people learning what was going on as I spoke.

[RRR]

They are just clerical/office staff and know nothing about the sharemarket. I had similar experience during Sky TV placement and called them first thing in the morning. The bloke I spoke to said that newscorp are selling on market! Luckily for me my wife has an account with Craigs and bought her some.

[tosspot]

so how do you go about getting the someone who can do something. storm there front office