BBI - Babcock & Brown Infrastructure

[ricee007]

25.8M SPARCS can elect to convert in Nov 2009. Conversion price will be determined by the "20 day average price prior to conversion date" as it was on Monday.

The remaining 120M SPARCS have to wait until May 2010 where the process will be identical to what happened this May. They can elect to convert or reset for another 12 months.

Thanks BB,
I'm confused though...

Do these 25.8M people *HAVE* to convert in November? That seems to make sense, but you have said "can elect to convert"...

If it's "can" elect... then how come only these 25.8M "can" elect to convert, and the others can't?

 

[investorpaul]

There is also an article in todays AFR.

Basically saying they would achieve a better price selling 100% rather than a minority.

They expect a sale within the quarter. BHP, RIO, Xstrata have expressed interest in the past and still could be among the potential buyers.

There was more but I read it quickly in the coffee shop before work. All up it was a pretty positive article.

 

[fureien]

wow bbi up 10% in 10 mins lol
all due to the announcement about gascan.

pardon my ignorance, but what relation is gascan and IEG to bbi?



(edit)
ok wait its kinda going a bit nuts 0.095 already....
do you reckon this is a pump and dump from the news.
(edit2)
haha its only been a minute, ppl dumping already

 

[investorpaul]

wow bbi up 10% in 10 mins lol
all due to the announcement about gascan.

pardon my ignorance, but what relation is gascan and IEG to bbi?



(edit)
ok wait its kinda going a bit nuts 0.095 already....
do you reckon this is a pump and dump from the news.
(edit2)
haha its only been a minute, ppl dumping already

The gascan announcement is a bit of a non event.

The price is probably up because long term holds are accumulating again after the large price drop last week.

And there hasnt been any more bad news, lol

 

[ricee007]

The gascan announcement is a bit of a non event.

The price is probably up because long term holds are accumulating again after the large price drop last week.

And there hasnt been any more bad news, lol

And the article in todays AFR...

And, to some extent, possibly the article in yesterdays AFR... but that wasn't overly positive. Today's seems nice and positive though.

BEPPA has gone from 1 buyer per 1 sell to 2.2 buyers per 1 seller
BBI has gone from 1 buyer per 2 sellers, to 2 buyers per 3 sellers...

Both up over 7% today.

Perhaps BEPPA will never hit 10c again...?

 

[fureien]

i guess your right, but still alot more selling going on than buying.

could i just ask, the sale of DBCt or whatever its called. theres no specific slated date right? just a generic indicator it would be in june, before the end of june?

i expect there to be a bit of rallying in june. now that ive stupidly sold my bbi, upon reflection i regret it lol. now its a matter when to get back in

 

[skyQuake]

Just daytraders and bargain hunters churning to each other, its fallen pretty hard so its garnered some attention.

Similar thing yesterday.

 

[investorpaul]

And the article in todays AFR...

And, to some extent, possibly the article in yesterdays AFR... but that wasn't overly positive. Today's seems nice and positive though.

BEPPA has gone from 1 buyer per 1 sell to 2.2 buyers per 1 seller
BBI has gone from 1 buyer per 2 sellers, to 2 buyers per 3 sellers...

Both up over 7% today.

Perhaps BEPPA will never hit 10c again...?

Could post a summary of yesterdays article?

Or perhaps someone else will be able to post it.

Im just glad to see some green hopefully at the very least, it finds support around these prices and doesnt move lower unless more bad news is forthcoming

 

[ricee007]

Could post a summary of yesterdays article?

Or perhaps someone else will be able to post it.

Im just glad to see some green hopefully at the very least, it finds support around these prices and doesnt move lower unless more bad news is forthcoming

Many recent asset sales start off at 49% and end up at 100%
"participants are now certain ... Macquaire Capital has a mandate to flog the whole port"
"still some way to go before a deal is reached"
"holding talk with the terminal's main users"
possible deal of 40% to miners, 60% to investors [like QIC]
If that doesn't work the "logical next option is to move forward with a straight 100 per cent sale"
"In the past, JPmorgan analysts have fixe a $2.8Bn enterprise value on the asset"

The Australian Financial Review
Page 27
Tuesday 19th May 2009
Offer of Stake in Dalrymple Morphs Into Full Sale
Edited by Jemma Whyte.

 

[banska bystrica]

The SPARCS related selling will probably start hitting the market in a couple of days. The new BBI certificates have been posted and once they hit the homes of ex-SPARCS holders, I would imagine some pretty heavy selling pressure on BBI. We can expect weakness for the next few weeks I would imagine. After that selling is mopped up by the market, the focus will return to the sale of DBCT.
Short term I am negative. Long term very positive.

 

[fureien]

The SPARCS related selling will probably start hitting the market in a couple of days. The new BBI certificates have been posted and once they hit the homes of ex-SPARCS holders, I would imagine some pretty heavy selling pressure on BBI. We can expect weakness for the next few weeks I would imagine. After that selling is mopped up by the market, the focus will return to the sale of DBCT.
Short term I am negative. Long term very positive.

ah i forgot that the sparcs holders have yet to do anything with their conversion. the whole market reacting to the news made me think "this is as worse it can get" oh well. if they put enough pressure on bbi. hopefully i can mop some up at bargain prices

i guess my only concern right now is that it might affect BEPPA. its done so well today i dont want it to be affected and drop down again.

 

[nathanblack]

beppa closed near its high for the day. bbi closed at its low. the closing auction seems to kill bbi everytime. afternoons in general are weak.

good to see beppa holding onto its gains, perhaps the gap between the two SP will widen.

people are mentioning the downward pressure the sparcs conversions may have in coming days, but will this be compounded by end of financial year? locking in tax losses?

 

[cbrendan]

If the gap between BEPPA and BBI widens it'll be a damn tough decision wherether or not to switch 50% (or maybe even higher ) to bbi.

Imagine a 11 cent / 6 cent swap, and then switching back again at close to parity once asset sales are announced!

beppa closed near its high for the day. bbi closed at its low. the closing auction seems to kill bbi everytime. afternoons in general are weak.

good to see beppa holding onto its gains, perhaps the gap between the two SP will widen.

people are mentioning the downward pressure the sparcs conversions may have in coming days, but will this be compounded by end of financial year? locking in tax losses?

 

[prawn_86]

Imagine a 11 cent / 6 cent swap, and then switching back again at close to parity once asset sales are announced!

Dont you mean IF the asset sales are announced? Nothing is certain especially when it comes to debt laden companies.

 

[banska bystrica]

Imagine a 11 cent / 6 cent swap, and then switching back again at close to parity once asset sales are announced!

cbrendan,
back in November I was lucky enough to buy 75,000 BEPPA at 5c (they closed at around 10c the same day) when BBI were around 2.8c. I then sold those BEPPA at 11c and bought 235,000 BBI at 3.5c the next day.
Nice way to convert 75000 BEPPA into 235,000 BBI.
Then on Dec 24 (Christmas Eve..... I remember it well) I sold those 235,000 BBI at 9c and bought 250,000 BEPPA at 8.5c.
I also sold other BBI's I had on Christmas Eve and converted to BEPPA at a half cent discount. Money for jam back then when all the panic was on.

I will be selling some BEPPA and buying BBI if this current gap widens anymore. When/if BBI have another run, the opportunity will probably be there for another switch at parity or close to it.

 

[banska bystrica]

Dont you mean IF the asset sales are announced? Nothing is certain especially when it comes to debt laden companies.

You are correct prawn_86, however, the probability of BBI not selling DBCT is very remote.
We know there are multiple buyers (the port users have been eyeing it off for a year now) and this coal terminal is one of the larhest in the world. The income is regulated by the Qld Govt so there is downside protection in times of recession. Have no doubt, there is enormous interest.

 

[cbrendan]

Then on Dec 24 (Christmas Eve..... I remember it well) I sold those 235,000 BBI at 9c and bought 250,000 BEPPA at 8.5c.
I also sold other BBI's I had on Christmas Eve and converted to BEPPA at a half cent discount. Money for jam back then when all the panic was on.

Remeber that day well.

It was the day i swapped 100% of my holding from BBI into BEPPA.

Better than any of the gifts i got the following day

 

[nathanblack]

they miscounted the sparcs conversion requests. subsequently more sparcs have been converted then originally announced and more BBI were issued(more dilution).

beppa is definately the one to hold these days

 

[ricee007]

they miscounted the sparcs conversion requests. subsequently more sparcs have been converted then originally announced and more BBI were issued(more dilution).

beppa is definately the one to hold these days

Totally.

10M more BBI on issue. Will totally dilute the 2.6Bn BBI shares on issue.

(Though, in the next couple of days, it MIGHT affect the SP as most of these 10M people consider selling (to put it into comparison, 55M BBI sold yesterday), but not really total dilution)

 

[nathanblack]

Totally.

10M more BBI on issue. Will totally dilute the 2.6Bn BBI shares on issue.

(Though, in the next couple of days, it MIGHT affect the SP as most of these 10M people consider selling (to put it into comparison, 55M BBI sold yesterday), but not really total dilution)

im just happy because the balance sheet has improves with every conversion, bring on more conversions i say. NTA per share will fall a little again, thats why i think the gap between BBI and BEPPA will not close now