What do you guys think of sale of CPC, page-8

I am not close to Consolidated Pastoral Company at all but a quick look indicates it is out performing AACo but they have been trying to exit for some time. So my SWAG would be anywhere north of $880m for the lot or if it was broken up it would take longer and they run the risk of having some parts unable to sell but would probably get near the $1Bn mark for the high demands parts of the business. It would depend on the marketing campaign that Frank Knight and Goldman Sachs pull together and if they can attract some competition for the business or its assets. I did find out it got sold in 2009 for around $400m but since then it has acquired further land holdings and changed the business so that really isn't the best guide.

As for AACo putting an offer in that might run up against the ACCC on competitive grounds and I would hazard a guess they have had a look at CPC already when it was doing the rounds last year. It would be a big ask of shareholders for AACo to put a full bid in and Tavistock may well have something to say about that given it has two board members with one being very active in an executive role.

I do wonder also if there is not some acrimony between the two companies given the shifting of some of the senior staff over the years and that wont help any AACo bid if they do decide to chase CPC.

Is CPC a good company to buy? For someone it is but they would need a clear plan and a differentiator to drive value into the business as the current PE firm wont be selling it under fire sale conditions and will certainly be seeking the maximum premium it can get, whether by a complete sale or a break-up and sell-off.

There are other options for the current owners to exit but I am sure Goldman Sachs have done the rounds on alternatives to an outright sale.

I see AACo has come up a little from its latest bottom so where to from here is anyone's guess now but lucky for those that took a punt on or under $1.10.