COL - Coles Group

Morning ladies and gentlemen.

This thread is for the continued discussion of CGJ - Coles Group, previously known as CML - Coles Myer.

When a company changes both its name and ASX code, it is the custom here at ASF to close the old thread and direct all discussion to the new thread. The old thread is kept for reference.

For those looking for the discussion when the company was CML - Coles Myer, please visit this thread: https://www.aussiestockforums.com/forums/showthread.php?t=4265

Thank you!

Interesting news today.


http://www.news.com.au/business/story/0,23636,21273671-462,00.html

Increased more than $1.25 so far this morning.

Sounds like bad news but as previously suggested bad results could be the catalyst for a renewed takeover

Can anyone remember what figure was talked about as the expected offer for Coles.I think $17 haseen mentioned but cant remember where.If you have a link that would be helpful.Thanks

Westfarmers indicative bid for coles at $16.47/share.

SYDNEY (Dow Jones)--The A$19.7 billion bid for Australia's Coles Group Ltd. (CGJ.AU) from a consortium including Wesfarmers Ltd. (WES.AU) and private equity looks to be a reasonable price, said an institutional shareholder and an analyst Tuesday.

However, they said other interested parties could well emerge with a better offer, although Wesfarmers' late Monday raid on the retailer may make a friendly bid difficult for rivals.

"My initial reaction is it seems like a reasonable price, but I'd need to have a look at the details," said Paul Xiradis, director of equities at Ausbil Dexia, which holds shares in Coles.

"But I suspect there are others which could also come over the top of them with a higher price."

Unveiling the biggest takeover bid in Australian history, Wesfarmers late Tuesday offered A$16.47 a share for Coles. Wesfarmers, a diversified conglomerate which secured an 11.3% stake in Coles in a Monday share raid, said under the plan its consortium partners Macquarie Bank Ltd., and buyout funds Permira and Pacific Equity Partners would own Coles supermarkets business. Wesfarmers would take control of its Officeworks and Target divisions.

The raid pits Wesfarmers against a consortium led by Kohlberg Kravis Roberts & Co. and including five other global buyout funds in the battle for Coles. Coles knocked back a revised A$15.25 a share from KKR in October last year but put the company up for sale five months later after issuing a profit downgrade and revealing lagging supermarket sales.

Grant Saligari, an analyst at Commonwealth Securities, said the Wesfarmers bid is "certainly within the A$16-A$17 range we'd been looking at." Coles shares, now subject to a trading halt, last traded at A$16.11.

Wesfarmers' raid on Coles could make it difficult for KKR to now move forward with a friendly bid.

"Whether KKR responds or not will probably depend on the response from the Coles board," said Saligari.

"KKR has indicated in the past that it would want to do due diligence and wanted a friendly approach. With Wesfarmers owning 11% of the stock, that could make that less likely. A few things are up in the air at the moment."

-By Rebecca Thurlow, Dow Jones Newswires; 61-2-8235-2959; rebecca.thurlow@dowjones.com
-Edited by Ian Pemberton


(END) Dow Jones Newswires

April 03, 2007 05:29 ET (09:29 GMT)

I see that CGJ is at 16.92 when the Wesfarmers offer is 16.47? So what gives? Why would anyone take the Wesfarmers offer - assuming that the price held at 16.92 when the actual offer came out? And who would be buying them at 16.92?

I think the 16.47 figure is ex dividend.. Sold mine for 16.95 this morning just to be out of it after waiting so long for something to happen..

Speculators buying looking for another bid, probably from KKR if it comes.

I personally consider it does not have much left in it. Note thst if another bid does not evenuate then it will fall back to $16.47 or lower.

this is crazy, this is a dog company a couple months ago and at the current price it's on the same par as Woolies in term of PE ratio.

If they cant turn Coles around this is one hell of a big mistake for who ever taking them on at $16.50 a pop.

Australian market is not that great and there isn't much room left for expanding unless you go oversea, and heading oversea
you will come up against the veteran of retails like Wal-Mart and Tesco.

I'm stay the hell away from all this craziness for now.

ROE said:

this is crazy, this is a dog company a couple months ago and at the current price it's on the same par as Woolies in term of PE ratio.

If they cant turn Coles around this is one hell of a big mistake for who ever taking them on at $16.50 a pop.

Australian market is not that great and there isn't much room left for expanding unless you go oversea, and heading oversea
you will come up against the veteran of retails like Wal-Mart and Tesco.

I'm stay the hell away from all this craziness for now.

Click to expand...

Yeah ist worth about $10 max

Earnings and Dividends Forecast (cents per share)
2006 2007 2008 2009
EPS 62.5 65.2 73.6 80.1
DPS 42.0 42.3 53.0 54.5

EPS(c) PE Growth
Year Ending 30-07-07 65.2 26.1 4.3%
Year Ending 30-07-08 73.6 23.1 12.9%

thx

MS

The scary thing is its happening everywhere....too much money and no home I reckon....Oh well, its an opportunity.

Cheers,

Bought a few shares in CGJ on rumours that the UK's Tesco are poised to make a bid. This was reported in the London Evening Standard and they state that "insiders quoted in the Australian media and the Wallstreet Journal say Tesco executives have signed up to take part in the bidding. Coles will open their books to suitors today in hopes of attracting a higher bid."

If you're onboard this one we should have quite a bit of fun ahead. Coles value may not look that much, but the companies potential may make it worth at least 15% more than Wesfarmers think, imho.

Still on the way up and the consortium may bid $20, imho.

This is where it's getting dangerous, speculating hoping for bigger fool to pay higher price ....this is where I exit

The value of Coles at present is not really that relevant, I think. Companies, the likes of Wal Mart and Tesco are high pressure outfits that keep margins slim and benefit shareholders and consumers. They are also patient and will always make good of every enterprise they buy-into.

Difficult to see, myself, the likely profitability a few years down the line. Is it double, treble or quadruple. Any of these make Coles an excellent buy.

My view, and entirely my view, $20 a share MAY prove very cheap in the long run.

"Stakes Rise in Coles' Bid". An announcement/Video to be made on this Link fairly shortly: http://www.abc.net.au/insidebusiness/content/2007/s1897572.htm

noirua said:

The value of Coles at present is not really that relevant, I think. Companies, the likes of Wal Mart and Tesco are high pressure outfits that keep margins slim and benefit shareholders and consumers. They are also patient and will always make good of every enterprise they buy-into.

Difficult to see, myself, the likely profitability a few years down the line. Is it double, treble or quadruple. Any of these make Coles an excellent buy.

My view, and entirely my view, $20 a share MAY prove very cheap in the long run.

Click to expand...

According to the man that run the most successful retail business in Australia and in the process killing Coles, Coles is way too high of a price.
http://www.news.com.au/business/story/0,23636,21563737-462,00.html

I can sell you a million shares in Coles for $18 if you want to buy it's still cheaper than your $20 a shares price tag

ROE said:

According to the man that run the most successful retail business in Australia and in the process killing Coles, Coles is way too high of a price.
http://www.news.com.au/business/story/0,23636,21563737-462,00.html

I can sell you a million shares in Coles for $18 if you want to buy it's still cheaper than your $20 a shares price tag

Click to expand...

Hi, I've been in stores in the US and UK and Coles just does not cut the mustard. Large Tesco SuperStores sell virtually everything you can think of, and operate 24 hours a day. Tesco and others open smaller stores in petrol stations and virtually everywhere you can think of. Downside is that lots of other stores close down. I bought enough stock last week, thanks

Tesco came up with Annual Profits at £2.55 billion ( $6.13 billion ). Encouraging reports in London Evening Standard with the Coles Group bid expectations in the wings.