board resignations, page-9

What is good for Hochtief isn't necessarily good for all shareholders. They (Grupo ACS) are desperate for cash. Leighton has bailed out MAH for example, and this may be part of the reason for their unhappiness. Also the crap raise in April 11.

While the AUD is strong ACS possibly want LEI to pay huge divs, return capital and gear up. Do shareholders want a smaller and more highly geared Leighton - for example - we have seen how volatile industry conditions can be. Do shareholders want LEI to not tender for a likely profitable project, because funds are earmarked for distribution to help ACS delever? Also ACS is a competitor - do we want ACS to be in a possible commanding position where they can tilt the playing field or cherry pick projects at LEI's expense. Finally there could always be suspicions that imaginative ways could be found to siphon cashflow from LEI (54% owned) to ACS (100% owned). Look at how Google, Ikea, Apple are alleged to be using transfer pricing and other means to ship profits to Ireland or elsewhere. Also look at how dysfunctional the "Macquarie model" was of having an independent manager of heavily geared up assets taking a fee from the asset owners for "management". All of these have been heavily discounted as far as I am aware.

I just don't think you should take these issues too lightly. Board independence is a huge issue. Maybe a 25% discount in the SP or so would not be the worst case. ACS might not care about the SP of LEI unless they are selling, and might prefer the SP to be low in case they can mop up the rest, and gear up LEI to cover the cashflow required to do so.

All of this is hypothetical at the moment. I have no reason to suspect that ACS/Hochtief representatives would do the wrong thing by LEI shareholders, I am just highlighting potential issues and concerns.

I hope for the sake of shareholders this does all blow over quickly.