The cross lease is clearly an issue for development, unless, a condition involves buying next door which could be the reason for a delay
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Agree as well, the turnaround is progressing nicely, the results so far are very encouraging as are the 1-3 year targets. While I feel for the 'long suffering' shareholders who are unlikely to ever get their money back, those that bought into the turnaround are already well ahead and should do very well in the medium to longer term.
Happy holder with no intention of selling.
Good to know that a year or so ago PE approached Sky with an indivative offer at the $2.30+ (post consoidation equivalent) per share range. This was likely before the cap raise when Sky was vulnerable doe to the bonds coming due.
If they had of negotiated the final price would surely have been north of $2.50/share.
Now Sky is much further along their transformation journey (there is actually light at the end of the tunnel) and the Balance Sheet is clean (zero debt). So the business is worth more than it was.
And if the Board felt that the offer made was low ball back then, they must have had the view that Sky was worth $3+/share.
So if any deal was to be done now I suspect it would need to be over $3.50/share to get their attention.
That may seem 'crazy' to some given the low SP...but I am just following the logic...
I didn't tune in for the AGM. So was there any mention of dividend resuming next year (regardless of property sale)?
Thanks buddy! Hope it'll be worth the wait. :t_up:
There is a difference between what offer price may be forthcoming at any given time, and what The Board think Sky is worth. Those two values need not align (and they clearly did not 12 months or so ago, otherwise they would have jumped at the deal).
I am simply pointing out that, if it is correct that they received an indicative offer of 23c/share...and they did not go into negotiations...it must be because the offer was way too low. Bowman made a big fuss about it being "highly conditional and not formal"...but that is a load of cr@p. All indicative offers are conditional etc as the purchaser wants to enter negotiations so they can take a closer look at the books (before settling on a formal offer and price).
So if 23c/share was too low back then to even go into negotiations...I can only assume that the Board must have thought that the business was worth at least 30c/share.
Fast forward to now, the debt has been paid off...we are advanced in our strategy (broadband has rolled out and the new STB is near...), the business is still profitable and generating healthy FCF...
Well, logically...if The Board thought Sky was worth $3/share (30c pre consolidation) back then I would have to assume they think the business is worth even more now.
So I believe an offer of $2.50 per share would also get rejected out of hand if they are being consistent (even though it would be a 30% premium to the current SP - which they said in the meeting they deem very low and "depressed").
What I don't understand is, if the business is doing well then what's stopping the board from reinstating normal dividend? The one off property sale should have no bearing on regular return to investors and SKY can just do a "special" dividend once the sale is finalised.
Will Sophie get a really huge payout if she orchestrates a takeover?
Otherwise must be a pretty demoralising job just hanging around anf hoping the offer comes soon.
For business owners of Sky (as opposed to traders), the best scenario is always for the business to be able to reinvest FCF for further growth. If the growth initiatives pan out then "value" is realised in time with a corresponding increase in SP.
We should only want a dividend (or buyback/capital return from the proceeds from the property sale) if management cannot reasonably use the money.
I think Sky still has a number of growth possibilities in front of them that they will need CAPEX for. So they cannot commit to any kind of distribution of funds to shareholders until they are satisfied that they could not make better use of the money with investment opportunities.
For example, I believe Sky Mobile is inevitable. Provided they could strike a good wholesale arrangement with Spark, Vodafone or 2D...I think this is the type of thing that could be a very good investment and I would rather they kept hold of the cash required to make the investment rather than pay it out to me as a dividend (that I have to give a portion of to Cindy anyway...).
If they distribute most of operating cashflow + all of the property proceeds to shareholders I would be disappointed. It would mean they can't find good opportunities for the business and have given up.
Hey come on now, don't do me like that! I am just stating what the Board have done...and what they said at the AGM...
I am not the one wishing for a takeover remember!
But, as an investor, I would assess any and all possibilities on their merits as they are presented to me (regardless of what I have paid, on average, per share).
LOL!
NBR article too...
https://www.nbr.co.nz/node/232212