Posted by me on Oct 30. RBS Morgans Ltd stated: "Should clients...

Posted by me on Oct 30.

RBS Morgans Ltd stated: "Should clients participate in the SPP?

This is a difficult one. In our view there is similar or better value elsewhere in the sector with lower risk attached in companies such as APA, MAP, SKI, SPN and HDF. At 8.7x EV/EBITDA the offer IS NOT CHEAP and post the recapitalisation BBI will still have higher gearing (~68%) than most peers. At 8.7x we would not expect to see the share price rally strongly once the new recapitalised vehicle commences trading (c.f. Asciano and TPI). Going forward do you also trust the same management that got BBI in this position in the first place...?"