In today's AFR Street Talk Online there is coverage of IIF that quotes Citi analysts' preference for IIF over GMG (I am glad I am not the only one who made such a distinction between the two, although mine was back in March, and I am sitting on a 550% gain thus far as a result).Citi analysts have raised their recommendation from SELL to HOLD although they think that IIF is still speculative in nature due to its debt obligations which it says are highly reliant upon asset sales.
Earlier in the article the author talks about a capital raising being unlikely for IIF until it buys back $400MN worth of preference shares it issued at $1 but which are now worth just 40 cents. The $400MN will have to come from somewhere and it won't be from the expensive $1.63BN refinancing deal. Instead the $400MN is likely to come from the asset sales that have been flagged by IIF. There are supposed to be $500MN worth of assets up for sale and once completed the proceeds are most likely to go towards paying out preference shareholders.
IIF Price at posting:
44.6¢ Sentiment: Hold Disclosure: Held
