The warning shot was to the Aust Government and FIRB in my opinion, yes, they
are cracking down on foreign buyers, or at least are starting to talk tough about it,
the landline news was very close timewise to the below news article on the ABC
When someone owns or controls a majority of any listed or unlisted company,
the minority holders have very little power, the majority shareholder, can basically
do whatever they want with that company. There are several companies listed on
the ASX that have majority (>50%) shareholders. I dont know of one of these that
actually works in the interest of minority holders, the few companies in this situation
that I have looked at, the majority shareholder basically runs the company for their own interests,
and there is not much the minority shareholders can do about it. Off the top of my head
I cant remember the companies names, (usually doing a search of discount to NTA
percentages, comes up with their names), but seeing what gets done to the minority
shareholders in these companies is quite alarming
I am not saying that Tavistock will do anything illegal or use its majority position
to the detriment of current holders, what I am saying is, once they get to a position
of >50%, minority shareholders will have lost most of their powers to affect any change
Tavistock with circa 40% is the major holder of AACo now, they have not made any T/O offer
or paid any sort of premium to get into this position, in fact you could say they were helped
into this position by the convertible notes issuance and subsequent redemption, which
were issued from memory to fund or pay down debt related to the building of the abottoir,
another few half year 3% increases and they will have control (if they dont technically already)
Mr Lewis is by all reports a very shrewd businessman
The last few years should have been bumper years for AAC, with the highest cattle
prices in the living memory of many in the industry, yet, whilst we made a paper profit,
no dividends were paid, in fact in the last half our debts increased $31million, and they
have increased the debt facility from $400mil to $500 mil
We have and are spending huge amounts on building the brand, that in the short term
appears to me to be the reason or one of the reasons that no dividends are being paid
and our debt is increasing. This lack of any dividend and the huge apparent short position
is driving the shareprice well below the NTA, allowing Travistock if they wanted to continue
to purchase the rest of AACo at cheap prices, the current discount to NTA is circa 50c per share
Shareholders like me and I am sure many others, would not enjoy being locked into positions
that are controlled by a majority holder and are thus selling, or at least not increasing their
holdings, again putting pressure on the shareprice, again allowing Tavistock to buy up more
cheaply if they wanted
Mr Lewis if by all reports a shrewd businessman
The EGM would be for a vote for either for a T/O offer from Tavistock,
or a guarantee from Tavistock not to increase its holdings
If neither of these were forthcoming
Then the vote would be for the sale or liquidation of
the whole of AACo.....nothing less
cheers grant
the above is my thought and opinions only, if I have made an errors please
let me know and I will try to correct them
AAC Price at posting:
$1.20 Sentiment: Hold Disclosure: Held
(20min delay)
