Property JV, page-10

JGPM

I beg to differ that the property JV is just noise.

The amount of funds to be sunk into the crappy Lumley Court location will be at least $8million and likely tied up for 2-3 years. If that were paid out as a dividend + franking credits it would be worth around 1cent and in your hands.

The property JV is a complete distraction for the Board who should be concentrating on the company's core strength, iron ore pellet production.

The property JV is not the appropriate method to preserve cash liquidity in the event it is needed for Southdown.

The Board has been conned by a cash strapped inexperienced junior developer who has gotten lucky with a director contact.

I wonder if any current Board member currently owns or has owned property in Melbourne. The Lumley Court location is crappy, its not near any village type shopping precincts in fact other that the kids playground next door it has nothing going for it. It is surrounded by very old 2 and 3 storey apartment blocks. To get back the money invested, let alone make a decent return the new apartments will need to be sold to owner occupiers as any rental return will be uneconomic.

And what director in their right mind would enter the high end Melbourne apartment market after the peak has been reached. That is really dumb. (I am a player in the Melb property market - absolute wrong timing by these dumb directors - the place to be is in new homes in Geelong, Bendigo and Ballarat)

At the AGM these dumb directors will spend all of their time defending the indefensible rather than giving shareholders valuable insights into the mining operations.

This whole property JV fiasco reminds me of the foray by Harvey Norman ( HVN) into the dairy business which after 18 means lead to a $40million write-off.

WTF!!!!!!!!!!! History repeating itself.

Please vote against the Remuneration Report at the AGM