this is why we are being conned

I could not understand why the directors of LLP are claiming, that because the Offer is at a premium to the NTA, the Offer s/be accepted by the LLp s/h.

The point I was concerned about, is WHY our directors are using the NTA ( rather than the NAB) as the yardstick???

Quote from IER - page 14"
"c) Premium to NTA
The Scheme Consideration of $0.31 cash per LLP Security, represents a premium of $0.01 to the LLP Group NTA at 30 June 2009.
The LLP Independent Directors have assessed that currently, with a lack of liquidity in the market for the aged care and retirement village asset classes, there is the potential for erosion of value in undertaking asset sales. The intangibles that make up the difference between LLP’s NTA ($0.30 per LLP Security as at 30 June 2009, see section 3.9.2 of the Independent
Expert’s Report) and NAV ($0.55 per LLP Security as at 30 June 2009, see section 3.9.2 of the Independent Expert’s Report)include a significant portfolio premium which a large scale business such as LLP enjoys. If the Proposal is not approved, the requirement for LLP to sell individual or groups of assets in order to raise not less than $300 million in additional capital may erode that portfolio premium."

So the NTA is 30c, and the NAB is 55c - a huge difference.

The difference between NTA and NAB is that intangibles are deducted from the NAB of 55c.
LLP intangibles include goodwill paid for the R/V, mgt rights, and value of Bed Licences and goodwill of the Aged Care assets.

"OUR" directors are saying that IF this proposal is not approved, we would have to sell off "individual or groups of assets" we would not achieve value for that goodwill/mgt rights/ bed licences.
Excuse me ???

Firstly, we may only have to sell off SOME of these assets - so why dedct ALL of the goodwill etc from the NAB ????

Secondly, I KNOW, that Aged Care bed licences are GOLD (GOLD, GOLD, GOLD) They are extremely hard to acquire, they are licensed by the Govt, they require huge effort to obtain and huge effort to retain. They are very valuable, and readily valued and sought after!
Why abandon the value of those bed licences.?

Thirdly, why dismiss any value for goodwill for the R/V?
No one can tell me that R/V having an EBITDA of $63m has no goodwill ! They equally are hard to licence, staff, and gain occupancy. So why no ggodwill?

Fourthly, in the g/will figure they have dismissed a sNIL, is $42.5m in mgt rights re PTN - hey, we already know PTN is to pay us that figure next year - so we know that's what those rights are worth! so why write them off? (page 32)

The real reason they compare the 31c with NTA, is because if they compared the 31c with the true value of NAB ie 55c, then no one would accept the offer!

Why do the directors compare the offer of 31c with a scenario that has NOT happened, will probably never happen, and if it does, would not be to the extent of 100% meltdown?

cheers