I thought David Darling successfully commercialised Arborgen years ago, before he left and went to PEB
Surely they still not in need of cash?
Printable View
https://www.nzx.com/companies/RBC/announcements/264466
Rubicon’s Chairman, Steve Kasnet, said "We are very pleased that we have secured Rubicon’s funding through fiscal 2016, and we believe that this announcement today should remove any ‘overhang’ in our share price in that regard.
Well, I'm glad that "overhang" has been sorted. Someone call Steve tell him the market hasn't noticed..
Similar statement following share placement in Feb 2014 ...Mr Kasnet, the Chairman of Rubicon, said "We have been pleased with the
positive shareholder feedback we have had from the Libra placement, as
evidenced by the Rubicon share price which has lifted more than 10% since the
announcement." .......Yeah right, then what!
Happy to pick up some more today at 30c.
Disc. Looking for a 100% gain and braced for a possible loss over the next 12 months. The reward of the former far outweighs the risk of the latter IMO.
DYOR.
I see that ACC have been selling out and moving on.
Starting to feel a bit lonely . . . .
Not being very intelligent i wonder if someone can tell me what the sell off by a substansial shareholder actually means and why they would do it?.
I hold a few shares in this company hoping that one day that i will prosper.Looks like a distant dream at the moment.
Isee that housing starts in the U.S.A. are 12% up on last month so i would expect the Tenon share price to rise and by default Rubicon or would that be to much to ask.
Annual Review should be out any day now....same old crap? Thank you to all the shareholders and your continuing support......
Dividend payments to begin immediately for Tenon
o First dividend of NZ5.0 cps declared in respect of fiscal ‘15 – payment in Nov ‘15
o Intention is to make two dividend payments per year
o Next dividend3
to be in relation to the 2016 Interim Result period – payment in
April ‘16
o Future dividend rates (i.e. cents per share) yet to be determined3
o Future payments will also be subject to3
the outcome of Strategic Review
Now that should help, now for the share price!
3. Earnings Guidance - In addition to these announcements, the Company also gave insight on its internal forward earnings targets. Mr Moriarty said, “Net earnings trebled in the FY ‘15 year just completed, and our expectation is for materially higher earnings next year. In this respect we are internally targeting EBITDA2 in excess of $20 million1,2 for fiscal ‘16 (excluding FX gains / losses). We reiterate our mid-cycle3 EBITDA guidance of circa $50 million.”
All references in this document to $ or “dollars” are references to United States dollars unless otherwise stated.
A quick valuation, 50mil US EBITDA should give us more then NZ$70mil EBITDA in mid cycle (assuming exchange rate wont go much over
70c NZ/US).
So say NPAT mid cycle of 50% of that, this will give a $NZ35mil.
Lets allow a low mid cycle P/E of 6 and the value of TEN shares comes out at over NZ$3.00.
Present SP NZ$2.30, sure liquidity is low but is this the best value on the NZX today?
Forest.
There always appears to something in the background with Rubicon......what's the fig for fighting this one...RBC
24/09/2015 11:58
GENERAL
NOT PRICE SENSITIVE
REL: 1158 HRS Rubicon Limited
GENERAL: RBC: ArborGen Court case - update
24 September 2015 - Further to last week's announcement in relation to the
on-going ArborGen employee matter, Rubicon said the Plaintiffs were now also
seeking costs and interest in the amount of US$10 million from ArborGen, the
three partner defendants (including Rubicon) and their representatives.
Rubicon repeated that although the South Carolina Court had yet to make any
ruling on the case, its intention is to vigorously appeal any adverse
outcome. Any appeals process could take some considerable period of time to
be determined.
END
Anyone else here have an inkling about this employee action against Arborgen? US$43m and now a further US$10m sought. Origins 2010.
Not a hint of this in the accounts for as long as I've been reading them , and yet if RBC's 30% interest in Arborgen warrants NZX disclosure of these developments now, how is it that some sort of note or contingency has not been necessary in the past?
I am starting to think that all this fluff about floating Arborgen when the time is right is absolute BS. No way could they float with this thing around the corner.
These guys snoozing away in the RBC boardroom year in year out - what do they do exactly?
Things that make you go Hmmmmmmmmmmm.
Did not realise it goes back to 2010!
On November 24, 2010, several of our employees filed a Complaint in the First Judicial Circuit of the Court of Common Pleas in South Carolina, which was replaced on November 29, 2010 with an Amended Complaint. The suit named as defendants us, our current directors, certain of our current officers, certain of our former directors and officers and a number of other parties, including thirteen of our current employees. In January 2011, the thirteen current employees were dismissed from the suit. The suit alleges that the plaintiffs and certain other of our current employees have rights based on a document that the plaintiffs allege provides for larger potential payouts to employees than the incentive plan that we actually adopted. The plaintiffs seek relief through a declaratory judgment, specific performance, an accounting and monetary damages. We intend to vigorously defend this suit.
Tenon going well but why the hangup on RBC?
So, it's official. Instead of yesterday's jam today, we we will get today's jam tomorrow. Yippee!
Confirmation on Arbogen just released....16 December 2015 – Consistent with previous announcements in relation to the on-going
ArborGen employee matter (including the Chairman’s presentation at the Company’s ASM
earlier this month), Rubicon announced today that the South Carolina lower court had
signed an order in favour of the nine plaintiffs, awarding damages of US$43 million plus
costs and interest of US$10 million from ArborGen, the three partner defendants (including
Rubicon), and their past and present representatives (jointly and severally). Rubicon
repeated that the intention is for ArborGen and each of the three partners to vigorously
appeal the lower court’s decision, and that they had been advised such appeals process
could take a considerable period of time to be determined.
I like the way in which the NZX list the announcement as ""not price sensitive""".
I would think that the announcement would stop everyone except the very brave and those in the know from buying in.
Meanwhile the long standing shareholder waits and waits.It won;t happen overnight but hopefully it does happen..
What is the court case all about?
From statutory report 2015....5.1(c) Other risks
A small group of ArborGen’s present and former employees have taken a lawsuit against ArborGen, its partner companies and its (current
and former) directors and offi cers, in relation to possible incentive payments to be made upon an IPO or sale of ArborGen (or a sale of all
or substantially all of its assets). ArborGen and its partners have vigorously defended this action. Whilst the initial court proceedings were
concluded in January 2015 and fi nal submissions were made in June 2015, the legal outcome is unknown as at the date these fi nancial
statements are signed, and is likely to remain unknown for some time
Still does not say a lot.....so much for 'Strategic review' for looking at ways to lift share value.
So the way I see it, the claim is for something that could 'possibly' happen in the future.......mind you it is the US of A!
The logical step to benefit from the strategic review is to switch from RBC to Tenon?
AborGen has been a burden for RBC and looks like will be a burden for a while yet.
Bearing in mind RBC hold 60% of TEN and that the market is currently putting a value of just $US10-11Million on Rubicon's share of ArborGen, or an enterprise value of just 30-44 Million, I would still see greater upside in RBC even with its pending liability.
If/when ArborGen eventually becomes profitable the upside for RBC is considerable, while also being exposed to 60% of pending TEN gains. I am happy to forego 40% of TEN gains to retain exposure to the ArborGen potential, and accept the increased risk for the potentially much greater reward.
Also the lack of liquidity in both stocks would make switching any meaningful quantity quite difficult at these prices.
NBR today has a headline that reads"""Bait and Switch allegations behind Rubicon lawsuit""
Because it's behind paid content i will have to wait untill i go to the library to see what the story is,unless someone on here can enlighten me and others.
Looks like, despite debt, Tenon is paying dividends,pumping money mainly to Rubicon, which does make you wonder how and why Rubicon should exist; where is the added value?? the market can't see it either.
Why should Tenon effectively borrow money to give Rubicon dividends?.
The article talks about the US lawsuit and says court documents show allegations RBC played a part in “bait and switch” operation to rip off staff at Arborgen. Basically comes down to claims of deceit against the Board and Management of Arborgen involving an attempt to deny staff their rightful share of the growing value of the Company.
A court filing shows an employee who was offered employment by Arborgen in November 2002 as a research associate at a base salary of $US46,500 a year, plus participation in the firm’s “New Value Added” equity plan. His initial NVA award was 1250 units.
A document detailing the terms of the original NVA scheme said units were worth 0.0001% of the equity value of the company.
However, according to the plaintiffs Arborgen in 2004 distributed a different NVA document to staff and represented it as the only one in existence.
This scheme valued units at 0.00001% of equity value – a tenth of the original agreement.
A staff meeting called by chief executive Barbara Wells to discuss the plan in 2004 was described as “contentious”. According to the claim, Ms Wells “shouted angrily several times ‘there never was another plan’,” and said “you should treat this as a gift”.
Staff were induced to sign the allegedly revised plan in subsequent small-group meetings with managers.
Under the scheme, NVA units would be paid out in cash if the LLC became a corporation or upon a “trigger event”.
Arborgen became a Delaware corporation in 2010 and filed documents for an initial public offer and Nasdaq listing.
The claimants then sought a court order that the company should have paid out under the original offer.
The statement of claim asserted that Arborgen’s fair value when it corporatized in June 2010 was $US750m, while a 2008 company document deemed its value in 2002 to be $US100m.
Based on the difference between those two valuations, claimants asserted the NVA units were worth $US650 each – a level that would make Mr Foutz’s award worth $US812,500.
Thanks iceman.....I would assume the plaintiffs still work for Arborgen......certainly not helping company staff relationships. What a fekin mess!
Well the result is out: http://www.nzherald.co.nz/business/n...ectid=11571751
and its not pretty..........Moriaty comes in for some harsh criticism by the judge.
I'm glad I got out of this when I did.
http://www.nzherald.co.nz/business/n...ectid=11572033 much the same as previous article but with mention of this mornings market reaction. I've waited 12 years to get a reasonable return, probably another 12 years to wait while appeals process plays out!
After taking out the value of the Tenon shareholding (59.8% of $175m) from the market cap of Rubicon ($102m), we're left with -$2 million. That's not good sign for the ArborGen investment.
Although, getting to the stage where this court case was lost just appears incompetent. Assuming that management were actually cheating their employees out of their shareholding, what were they thinking? Was there no chance of settling the case at an earlier stage for much less money? And does an appeal have any chance of success, or is it just more money down the drain?
This judgement seems to wipe out the whole value of the company. Hopefully some incompent oaf has at least lost their job over this.
Totally agree mikeybycrikey.....but I think that if they put their hand up after the deed to say sorry we were wrong, accusations were so strong the plaintiffs would still have a case against the company as to how they were treated.
Share price down again today.
Glad I have never had any shares in this company that has no reason to exist, except to pay it's CEOs; apart from paying them all it does is hold shares in Rubicon and Arborgen; with a major conflict of interest as Moriarty, while probably not wholly to blame for the court case, is involved in Tenon as chairman and has strong connections to Arborgen.
Delaying any settlement could cost even more, and wipe out Arborgen altogether unless it has a massive turnaround in it's fortunes.
I don't think Tenon should be paying dividends, especially while it has debt, and especially not to Rubicon.
Abandoned ship,taken a hit but willing to take it on chin.Have had shares in 3 companies involved in the farming/forestry industry and all have been disappointing to say the least.Too early to say never again however it's is a likely outcome.
market cap 80 mill
Rubicon's share of Tenon alone, at 2.60 is worth almost 24c per share. Even if Rubicon ends up paying its full share of the current judgement ( which in my view is unlikely), Arborgen is still worth more than zero and there is the real possibility of a successful appeal or earlier reduced settlement. In any case With Third Avenue Management needing cash and selling down regardless at the moment and pushing the share price down I think 21c is very good value and I'm adding at this price. Thank you TAM.
Found this, not a pretty read, but even I can understand it.
Ten current and former workers at Summerville-based biotechnology firm ArborGen Inc. won a $53.5 million judgment against their employer and some of the nation’s top forest products companies after a judge ruled the companies tricked workers into accepting incentive plan changes that depleted most of their wealth.
Judge Edgar Dickson also entered judgments against International Paper, MeadWestvaco — now WestRock — and New Zealand-based Rubicon Inc., as well as some of those forestry companies’ board members, following a trial in Dorchester County that lasted nearly three weeks.
The trial was held in January and Dickson’s final decision was issued last week. Rubicon has said it will “vigorously appeal” the ruling. It is not clear if the other companies plan to appeal the Dec. 22 judgment. A lawyer representing those companies and their board members could not be reached for comment Tuesday.
ArborGen, which develops seedlings that sprout into fast-growing trees for the forestry industry, was formed in February 2000 when the biotech divisions of MeadWestvaco, IP and Rubicon were combined. The workers who filed the lawsuit were employees of IP or MeadWestvaco and later ArborGen.
According to the lawsuit, the employees were led to believe that they were getting potentially lucrative options in their compensation packages allowing them to share in the future growth of ArborGen, which was valued at $100 million shortly after its formation.
As ArborGen began to grow, the lawsuit alleged, the company’s board members decided the compensation package was giving the employees too much money.
“The defendants orchestrated a scheme to switch the option plans given to the employees, diluting the value of the original option plan,” according to a statement from Chip Bruorton, a lawyer with Rosen Hagood who represented the workers.
Bruorton said changes to the incentive plan were “introduced to the employees with false information, misrepresentations and concealment as part of a wrongful scheme to defraud them of their rights in the plan.”
When ArborGen was converted to a C-corporation — that is, a corporation that is taxed separately from its ownership firms — the company’s value was $650 million.
According to the lawsuit, the workers claimed they should have been given incentives based on the $550 million in growth ArborGen experienced since its formation, “but the defendants failed to provide the employees with the value they were entitled to.”
An affidavit by Steve Pomerantz, an investment management expert, showed the 10 employees should have received a combined $11.3 million of equity in the new ArborGen C-corporation. Instead, they were given a combined $414,330 of equity based on the revised plan that was created when ArborGen’s growth took off.
The $53.5 million judgment handed down last week also includes interest and punitive damages.
Dickson, the circuit judge, said in his ruling that the employees “were abused by ArborGen, its founders, its board members and its management. ... In not honoring the contracts, the defendants acted with a lack of honesty and integrity.”
Bruorton said in a statement that he is happy with the outcome.
“The court took a great deal of time and effort to understand the facts of this case and made a decision that is supported by the evidence presented. My clients were wronged, and I’m happy that their rights have been vindicated.”
Leaves me wondering just what Arborgen is worth, if anything.
Also consider after reading that, that Arborgen et al may be penalised even more if they do not settle quickly; I really wonder if they have anything much to settle with...so have to delay(and pick up CEO/Directors' fees along the way)
Would you lend the CEOs NZ80 mill to pay off such a settlement??
This is now really quite an old story. It also only reflects the view of the plaintiffs and contains no balancing view from the defendants. There is a little bit more to this story than meets the eye and my view is it will play out before too long and may be alongside the result of the Tenon strategic review which I guess is not that far away.
Also the amount of the judgement is extreme and under appeal could be severely reduced.
I'm sure all parties involved are aware of this.
24March 2016 - Rubicon announced today that the South Carolina Court presiding over the
ArborGen employee litigation has granted the defendants' (i.e. ArborGen, International
Paper, MeadWestvaco, Rubicon, and their current and former representatives) motion to
alter / amend the judgment in this matter. The Court has dismissed the litigation, and
vacated in its entirety its prior US$53 million order in favour of the plaintiffs (i.e. it is null and
void, and of no effect), and the parties to the litigation have agreed a confidential settlement
arrangement, which brings this matter to a final conclusion. The net financial cost to Rubicon
of that settlement is immaterial, and as far as Rubicon and its investment in ArborGen are
concerned, there is no further financial impact from this lawsuit.
As the settlement terms are confidential to all parties, there will be no further comment on
the matter.
Finally heading in the right direction.....31.8% lift is impressive.
Default
24March 2016 - Rubicon announced today that the South Carolina Court presiding over the
ArborGen employee litigation has granted the defendants' (i.e. ArborGen, International
Paper, MeadWestvaco, Rubicon, and their current and former representatives) motion to
alter / amend the judgment in this matter. The Court has dismissed the litigation, and
vacated in its entirety its prior US$53 million order in favour of the plaintiffs (i.e. it is null and
void, and of no effect), and the parties to the litigation have agreed a confidential settlement
arrangement, which brings this matter to a final conclusion. The net financial cost to Rubicon
of that settlement is immaterial, and as far as Rubicon and its investment in ArborGen are
concerned, there is no further financial impact from this lawsuit.
As the settlement terms are confidential to all parties, there will be no further comment on
the matter.
What an absolutely stunning result!!
Tenon strategic review results not far away and a review of Arborgen capital requirements v shareholder return in progress IMO means that finally, as Julius Caesar uttered the famous phrase "alea iacta est"—the die is cast—as his army marched and crossed the Rubicon.
The next few months may well be, and finally, defining ones for RBC.
At 28c IMO RBC is still hugely under valued but I'm holding a few so I'm biased.
[QUOTE
What an absolutely stunning result!!
Tenon strategic review results not far away and a review of Arborgen capital requirements v shareholder return in progress IMO means that finally, as Julius Caesar uttered the famous phrase "alea iacta est"—the die is cast—as his army marched and crossed the Rubicon.
The next few months may well be, and finally, defining ones for RBC.
At 28c IMO RBC is still hugely under valued but I'm holding a few so I'm biased.[/QUOTE]
It's been along wait Biker......I have a hefty holding so am pleased, but kicking myself at the same time as I attempted to buy 50,000 earlier in the week @ 21c....too stubborn to move the goalposts.....
It's been along wait Biker......I have a hefty holding so am pleased, but kicking myself at the same time as I attempted to buy 50,000 earlier in the week @ 21c....too stubborn to move the goalposts.....[/QUOTE]
Sure has Ari.
I'm wondering if Rubicon will even exist by the end of the year.
You may be right biker...anything above Edison's conservative value of 64c in April 2015 would clear my cost of 55c, but their more bullish value of $1.06 would be nice way to go out!
I think the value is there ari it's whether or not it can be extracted and returned to us that remains to be seen. Certainly something beyond your 55c shouldn't be a problem. I need to see 29c to clear but haven't hung in there this long not to see possibly 3 times that.
Tim Hunter from the NBR must have choked while he was writing this after his previous vitriolic article condemning Luke Moriarty et al.
Rubicon settles US lawsuit
TIM HUNTER THURSDAY MARCH 24, 2016 5
SHARE
Investment company Rubicon [NZX: RBC] has settled a lawsuit in the United States, ending a $US53 million claim against the company and several other parties including its chief executive Luke Moriarty.
At the time that Fletcher Challenge unlocked the potential of each of it's four divisions (Paper, Forests, Energy and Building, for the younger folk) Rubicon was also created.
There was much debate about Rubicon's purpose in life. After all the debate, a satisfactory answer had not emerged.
And me - I'm in it because I am taking a punt on the value of the Arborgen pine technology. A pure, simple punt on a New Zealand technology company. Like BLT, PEB, SCT and the others.
Absolutely right GTM3442. It is a pure punt being in RBC. As a company it has no meaningful purpose. I took a punt on this last year but dumped it immediately when they announced the lawsuit. I note despite the "big" increase yesterday they have not even reached where they were SP wise before the lawsuit announcement. I still think this one is ripe as a high risk punt though, but an investment it is not.
It exists to pay it's CEOs
Which should be used to pay off Tenon's debt
Chris Lee's has an interesting summing up of the court case on his website TAKING STOCK.
It pretty much says the the Directors come across poorly and were told so by the judge.
From the Rubicon website:
"The sole purpose of Rubicon is to bring value to these two remaining investments, and Board and management are incentivised accordingly."
The activity leading to the first part is not clear but the actions to achieve the second are abundantly clear.
Reasonably large volumes today for RBC,very difficult to know how this is going to end.Obviously hoping for the best but who knows.
Found this from April 2009....still dreaming.........http://media.nzherald.co.nz/webconte...rreportPDF.pdf
a conservative case valuation of NZ$0.64 per share – Tenon NZ$0.36 (lower end of range),
plus ArborGen existing NZ$0.33, (ie base value net of current debt) and including Rubicon net
debt of NZ$0.05 per share.
a more bullish case valuation of NZ$1.06 per share – Tenon NZ$0.47, plus ArborGen total
NZ$0.64 (net of current debt), again including an NZ$0.05 per share adjustment for Rubicon
net debt. Ex Edison
Good volumes again today.Wondering if wise men are buying or wiser men selling.
Last update says.......an announcement in respect of the outcome of its Strategic
Review process either in conjunction with, or prior to, the release of the
Company's 30 June 2016 financial results..........watching very closely, this will definately be make or break.....
I cant understand the muted sharemarket response to Rubicon. The 2009 Grant Samuel analysis, at a time of depression type new housing activity in the USA valued Rubicon at a range of $1.09 to $2.26 assuming they consent to the sale of Tenon. Now that valuation was 7 years ago. I would have thought a 24c share would potentially skyrocket in this scenario. Is it a case of under the radar??
That was then, and this is now :
Tenon is valued at between $3.01 to $3.25 - so total valuation of $195m to $211m.
RBC owns 59% of Tenon so RBC's share will be $115m to $124m or 28c to 30c per share.
With RBC shares being offered at 26c on market, market clearly is placing zero value or even negative value on AborGen - which could be the hidden gem when it finally gets sold or floated?
If TENON only sell the USA part of their operation will Tenon stay listed and at what price?
Can't do any harm to Rubicon.........Scion are in partnership with Arbogen....http://www.nzherald.co.nz/nz/news/ar...ectid=11702838
I fear the answer may remain one of lifes mysteries at least until the AGM.
Good news in the U S today,new home builders have a surge in confidence.Should be good news for TENON and by default RUBICON.
Let's hope it can hold for another 2 mths or longer if sale does not eventuate. Went past Tenon plant in Taupo at the weekend, that's a very large plant.......
http://www.bloomberg.com/news/articl...nine-year-high
I'm sure there is more to go in share price, but interest is limited, accept for the buyer/buyer's who have been buying at 23.5 for some time.....https://www.nzx.com/files/attachments/242560.pdf
Down to 20c........can't remember when it has ever been this low
In their annual review i recieved today they say that the return of capital will be more than sufficient to repay all Rubicons bank debt and subordinated notes should they wish to.They also say that it will meet Rubicons future Arbor Gen funding.
Maybe Rubicon shareholders were expecting more.
Not very clued up on reports and honestly i cannot see anything regarding the value of AborGen although it could be looking me in the face and i wouldn't see it,
Found this old Edison report (April 2015).....oh, how things have changed..http://www.edisoninvestmentresearch....eport/rubicon5
Is this capital return of Tenon's good news for RBC.A bit of movement in the SP this morning and activity this week would suggest it is,lthough i have been wrong many times before.
That is the question for sure.
I was thinking of buying a few more but at this stage i'm sitting on the fence and with my luck which ever way i choose it will be wrong.
If it wasn't for bad luck,id have no luck at all.
I was just reading Brian Gaynors article on Rubicon from a few years ago yesterday and now an update.....http://www.nzherald.co.nz/business/n...ectid=11729059
What are the chances of Rubicons main men reading this and saying'''he's right'''.
Iwould suggest none but am willing t be shocked.
They may, but certainly not taken any notice since earlier article by Brian Gaynor, Mar 2012..http://www.nzherald.co.nz/business/n...ectid=10794164
Perhaps with funds rolling into Rubicon, conditions may be right for Arborgen float.....
Float aborgen and then what for the long suffering RBC shareholders.
It would be the last step of the puzzle to unlock value for shareholders, long term shareholders will reap the value they want so much. Everyone is being so well paid in management and directorships, I'm not sure they feel to bothered whether they do or they don't.
Lets weigh it up, Tenon is valued at $165 million, RBC own about 60% of the company so that is about $99 million worth to RBC.
Arborgen a few years ago was valued at over $500 million (lets just use that figure), but the share price currently suffers as no one can put a solid figure on how much it is actually worth and not generating positive cashflow doesn't help. Time has passed and the business is has overall done better so could be worth even more. At about 32% ownership of that, thats $160 million of value. Add the two and you have $259 million company, at least twice its value of where it is at right now.
It will re-rate the share value given more certainty with an Arborgen IPO even if there is no plan to sell down and everyone can make a decision and go their way.
At 23cps is Rubicon the buy of the year?? I guess will have to wait until the AGM in mid D ecember to see whether I will get a nice Christmas present in terms of a capital return(or not). Will keep polishing the crystal ball. In the meantime Mr Market seems uninterested