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08-11-2017, 11:31 AM
#1021
Member
Originally Posted by Fatboyj
Any snipits you can post from the article? Is Hendo's name mentioned anywhere?
Article is on NBR online. Hendo is not a defendant in the ruling.
I like doing the valuation on this company, you've got a relatively negative outlook while there is also a positive lump sum contingent asset. Its like the opposite of FPH.
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08-11-2017, 12:34 PM
#1022
Member
Originally Posted by Out to lunch
Article is on NBR online. Hendo is not a defendant in the ruling.
I like doing the valuation on this company, you've got a relatively negative outlook while there is also a positive lump sum contingent asset. Its like the opposite of FPH.
Got a guess or any insight as to what this windfall might mean for ALF? PWC settlement wouldnt have been chicken feed to start with.
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08-11-2017, 02:37 PM
#1023
Member
Originally Posted by Lola
Got a guess or any insight as to what this windfall might mean for ALF? PWC settlement wouldnt have been chicken feed to start with.
The unknown factors are:
1) ALF's percentage cut of net proceeds under the Deed of Assignment
2) PwC settlement sum
3) Directors settlement or claim under the courts
4) LPF's costs- they're probably incentivised to not have max net proceeds, try and falsely increase the costs (google Hollywood Accounting).
So to calculate ALF benefit: 1 * ((2+3)-4)
My val has this at: 10% * ((20m+0m)-5m) = $1.5m, and no tax impact.
Let me know if I am missing something or my assumptions seem wildly out - at least its a base for sensitising return.
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08-11-2017, 03:15 PM
#1024
Member
Originally Posted by Out to lunch
The unknown factors are:
1) ALF's percentage cut of net proceeds under the Deed of Assignment
2) PwC settlement sum
3) Directors settlement or claim under the courts
4) LPF's costs- they're probably incentivised to not have max net proceeds, try and falsely increase the costs (google Hollywood Accounting).
So to calculate ALF benefit: 1 * ((2+3)-4)
My val has this at: 10% * ((20m+0m)-5m) = $1.5m, and no tax impact.
Let me know if I am missing something or my assumptions seem wildly out - at least its a base for sensitising return.
We know 1. is 5 % publicly available info.
2. we dont know but the claim is for $302 million plus interest.
3. we dont know but PWC settled . Remember they had already lost in three courts so obviously didnt want to roll that dice again. Could be 20 to 50 million.
3. Agree
So my guess based on above plus ALFs own statement a while back that indicated they expected "substantially "more than what they had received to date for selling the loans in the first place which was $100,000
So range of 1m to 2.5 m
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08-11-2017, 05:25 PM
#1025
Originally Posted by Out to lunch
So to calculate ALF benefit: 1 * ((2+3)-4)
My val has this at: 10% * ((20m+0m)-5m) = $1.5m, and no tax impact.
Let me know if I am missing something or my assumptions seem wildly out - at least its a base for sensitising return.
Further to Lola's response, bear in mind that there are 2 'tranches' to ALF receiving money from this litigation process. They are outlined in my ST post here:
https://www.sharetrader.co.nz/showth...l=1#post663892
I am trying to keep $0.00 in my emotional bank regarding both tranches, certainly the 2nd tranch. For the 1st tranch though, underneath I do expect something, just don't know the quantum.
The example used before the courts (and is public information) by PWC's lawyers is as follows. The 3rd column is my notes and represents my current understanding which could be flawed.
Claim (Resolution Sum) |
$334,000,000 |
This number subject to interest rate penalty and for this table assumes it to be 0.00% |
Less Project Costs (say) |
$3,000,000 |
|
Net Resolution Sum |
$331,000,000 |
|
|
|
|
SPF Services Fee 42.5% of
the Net Resolution Sum |
$140,675,000 |
|
|
|
|
Less Liquidation costs (say) |
$2,000,000 |
|
|
|
|
The Net Amount – Available to
PVL Creditors |
$188,325,000 |
ALF get 5% of this amount for the 1st tranch (the Assignment Fee). Under this example it represents $9.42 million |
|
|
|
Distribution of Net Amount |
|
|
To SPF as 1st Secured Creditor |
$188,115,226 |
|
Other Creditors |
$209,774 |
|
|
|
|
The last real variable for tranch 1 is the interest rate. I have looked at cases in the past regarding this type of litigation and do not think 8%/annum compounding is unreasonable at all. Ignoring the table above for now (which except for column 3 was put together by PWC's lawyers), the original amount filed against PWC in 2013 was $302 million.
So 8% compounding on $302 million from 2013 equals $445 million in 2018
Using the remainder of the table above, this hypothetical scenario brings ALF's tranch 1 from $9.42 million to $12.6 million (unless I have slipped a decimal point somewhere).
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28-11-2017, 08:43 AM
#1026
Vaygor1.
Spot on...Divie.....!!!!!
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28-11-2017, 08:44 AM
#1027
Originally Posted by percy
Vaygor1.
Spot on...Divie.....!!!!!
not much... but imputed and a start
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28-11-2017, 09:22 AM
#1028
Yee ha! well done holders. Only 1% of my portfolio but nice to have this divi plus further positives to come for patient holders.
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28-11-2017, 09:59 AM
#1029
Thanks Percy, Blackcap, and Left Field.
Positive news indeed !!
The announcement indicates to me the H1 forecast for this financial year is healthy enough to warrant this payment without too much risk of reducing their free cash-flow.
Will be interesting to watch the SP over the next week or three.
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03-12-2017, 02:57 AM
#1030
Further to my post about 4 weeks ago (here.... https://www.sharetrader.co.nz/showth...l=1#post691896 ) on the potential amount ALF might receive as the Assignment Fee via the LPF litigation process, I have since learned the penalty interest rate as per the loan contract in question is specified as 1.5% per month with monthly rests (i.e. compounding monthly).
My example from 4 weeks ago used 8% per annum as the penalty interest rate but 1.5% compounding monthly equals 19.56% per annum.
Using the 19.56% per annum penalty interest, I calculate a potential award of of $302 million in 2013 equates to $737 million in 2018. If this is the amount awarded, and running it through the table as per my post from 4 weeks ago, ALF would receive $21 million as their 5% Assignment Fee.
Last edited by Vaygor1; 03-12-2017 at 12:39 PM.
Reason: typo
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