seven-westrac mergerkwhat a great deal!, page-8

I haven't finished whinging yet....
Also please note, Kerry Stokes through his private company Austrlaian Capital Equity (ACE) has bought ALL the land and building previously belonging to Westrac for $100million. These will be rented out to Westrac for $40million/yr with a 3% rent increase each and every year. The Lessee (that's us) will bear the cost of maintaining the property (including capital works), insurance and ACE's legal costs. Yep, it's all there on pages 406-407 in part B of the Scheme booklet. Go on have a read. There is even an additonal "special rent" that may be payable by the Lessee. As stated in my earlier post, Caterpillar only needs to give 90 days written notice to terminate the dealership agreement with WestTrac. "What exactly are you guys buying for $2billion?" giggled my Barmaid. "The Kerry Stokes dream" I replied sarcastically. "What does your investment property return?" I asked her. "The rental yield is 5% before expenses" she replied. You should have bought a Westrac property. You could have got a rental yield of 40% and there would be NO expenses!
I don't understand. "Why do you guys have to pay ACE's legal costs?" my barmaid wanted to know. Because Kerry Stokes said so.
Also, Westrac has a contract to rent the corporate jet owned by Kerry for a MINIMUM fee of $2mill/yr plus GST till 2018. There are additional fixed and variable charges that are also payable by Westrac. At Kerry's discretion this fee and charges can be varied. There are a number of other related party transactions between Kerry and Seven Group Holdings.
Looks like the current cash in Seven and a large chunk of future cash flow is heading towards Kerry Stokes the Creditor. Do Seven shareholders and SEVPC Holders know about this? Probably not. Ignorance is bliss.
I will vote NO and I hope everyone else votes NO as well. I for one will not be getting screwed over like one of Kerry Stokes 3 ex wifes. We only need 25% of (non Kerry Stokes) shareholders (by value) to scuttle the deal. Achievable. Unfortunately, my gut feeling says the deal will proceed. This is based on the theory that those who are against the deal would have been selling out over the past month to those who are for the deal. Also shareholders Ausbil Dexia and Perennial Investment Partners owning 7.3% and 5% respectively of Seven are staying silent for the moment. This usually means they intend to vote for the deal. Where is Stephen Mayne when you need him?
Why doesn't Kerry Stokes float Westrac??? That way if anyone is interested they can subscribe to it. "There are plenty of Myer shareholders who will happily part with their money" chuckled my barmaid.
'Smart money' realised this was a DUD deal and moved out of SEV shares the day the deal was announced. Remember the share price hit a low of $6.80 on Mon 22/2/10 after closing at $7.36 the previous Friday. A 8% discount.
See you all at the Scheme meeting on 20th April. "I will be going as one of Stoke's ex-wifes" my barmaid proudly exclaimed. "I will dress up as Judge Sackville", I replied. That should give him a fright.
Cheers,
hih
'In Life there are Winners and Losers' Bill Gates
I say, "In life there is Kerry Stokes and Seven shareholders"
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