BCS - BrisConnections Unit Trusts

[cuttlefish]

Re: Brisconnections shareholders - financial ruin

From converstions with Rocket it appears we have a couple of possible avenues.
Without speaking to Rocket first I am not going to publicly disclose this delicate info, without aproval of the others.
I will however PM Julia & Cuttlefish since they have been very helpful and try and keep you informed.
Needless to say ,all those involved ,I believe have been coppied in on these e-mails.
We are taking a very pro active approach to the situation. ( Big thanks to Rocket)
You may or may not be supprised that other share holders have also come forward to join our "Action group"

Thermal - I agree that its a good idea to be careful about what you put up in the forums. No need to send me a PM either - its probably best that your 'team' manage the dissemination of information and also start to manage any PR/publicity surrounding your efforts in an orchestrated way - and this forum is a public communication vehicle just as any other media outlet.

It sounds like everyone is doing the right things and in touch with the right sort of people - I'm happy to leave you all to focus on it.

 

[Absolutely]

Re: Brisconnections shareholders - financial ruin

Bushie, thanks for PMing me. I am seriously considering your offer - just want to think this thing through a bit, and I think I have got at least a couple of months to do so. (Unless Macquarie suddenly starts buying that huge pile of shares sitting at 0.1c - which I am not discounting as an impossibility).

To my mind the money is going to be paid up by somebody - if not by the shareholders, then by the underwriters. The money is then going to be spent building a road. The road is going to produce an income. The income is going to produce value for owners of the shares - at some point those shares are going to be worth something. Might be a while - but Brisbane is a rapidly developing city. I travel there often and this road from the airport to the city is definitely going to get used. (Think Sydney's Eastern Distributor). Reputable companies have already spent time and money on statistics, working out useage probablilities and what toll is required to provide a return for shareholders.

Getting a few of these for almost nothing right now, provided you only get what you are comfortably able to risk on the next two installments may not be the worst investment one could make - thinking 5+ years from now.

 

[Sir Osisofliver]

Re: Brisconnections shareholders - financial ruin

Bushie, thanks for PMing me. I am seriously considering your offer - just want to think this thing through a bit, and I think I have got at least a couple of months to do so. (Unless Macquarie suddenly starts buying that huge pile of shares sitting at 0.1c - which I am not discounting as an impossibility).

To my mind the money is going to be paid up by somebody - if not by the shareholders, then by the underwriters. The money is then going to be spent building a road. The road is going to produce an income. The income is going to produce value for owners of the shares - at some point those shares are going to be worth something. Might be a while - but Brisbane is a rapidly developing city. I travel there often and this road from the airport to the city is definitely going to get used. (Think Sydney's Eastern Distributor). Reputable companies have already spent time and money on statistics, working out useage probablilities and what toll is required to provide a return for shareholders.

Getting a few of these for almost nothing right now, provided you only get what you are comfortably able to risk on the next two installments may not be the worst investment one could make - thinking 5+ years from now.

@ Absolutely

I can't provide you with advice. No advice provided here but have you really thought about this?

Are you aware of what the effect of a fire sale auction price will have on the value of post 2nd instalment share price will be?

Have you compared the share price movement to it's closest peers? Eg What has happened to MIG, CEU, TCL, RCY???

RCY is it's closest peer - its in the same city, connects to the airport link being done by brisconnections, and doesn't have an existing road at present (still being finalized -but a LOT closer to completion than BCSCA). So have a look at that share price and add whatever you think is appropriate as a risk weighted measure for the following factors:-

* Large Stock Overhang - and I mean LARGE - weighing down on the share price for several years.
* A completely fractured share registry
* Potential loss of reputation and brand damage
* Potential Litigation from Macquarie and Deutsche
* Potential Litigation from Shareholders and Class actions

Remember that many of these infrastructure plays are designed to have just enough funds raised to get them to the end of the build period with a small buffer while traffic on the road builds up and brings in revenue. If they have to spend money on.....

* Exorbitant Expenses in keeping the registry and market informed.
* Large legal costs from litigation
* Smaller Interest payments (because they have to wait for the underwriter to pay up rather than getting the money up front)

etc etc etc. Where does the money come from?

Sorry Bushie et al, you'd have to PAY me to take these off your hands - and that would be AFTER the 2nd instalment was paid.

Sir O

 

[cuttlefish]

Re: Brisconnections shareholders - financial ruin

Sorry Bushie et al, you'd have to PAY me to take these off your hands - and that would be AFTER the 2nd instalment was paid.

Sir O

Pretty much my sentiments as well - I can't see them trading anywhere near a dollar after the second instalment has been paid.

(Unless Macquarie suddenly starts buying that huge pile of shares sitting at 0.1c - which I am not discounting as an impossibility).

Why would Macquarie do that - they've only fairly recently finished offloading their entire holding - and they will still be stuck with the bill for the instalments that default (a lot by the sounds of it - probably including a lot of the ones they sold on market this year that were bought by uninformed purchasers) and end up with a whole bunch more stock that they will also probably want to offload to recoup some of the money spent on the underwriting, and to avoid further costs in the final instalment fee.

 

[Absolutely]

Re: Brisconnections shareholders - financial ruin

I can't provide you with advice. No advice provided here but have you really thought about this?

That's what I'm doing now. This sort of thing needs some thinking outside of the box to assess solutions for those in the predicament, but there may also be possible opportunities. Perhaps recognising that opportunity will lead to the solution. I don't know.

Whilst I totally agree with all your sentiments regarding the risk of investing in such infrastructure projects, I think the huge loss in share price value in 3 months could of removed a lot of that risk. Like I said previously, big and international players have assessed and underwritten the project, they must of seen value even before this debacle. And at the current price (ie free) small guys like me can afford to make a balanced decision on the investment, knowing the liability and prepared to lose a comparatively small investment. But the possible flip side is that if the project produces the projected income in the future, the pay off could be huge.

Cuttlefish it would be very smart for Macqaurie to buy back, but they are under no immediate pressure to do so and can hold off right to April. Thing is they may end up with a lot of those shares and the associated liability anyway. Pursuing shareholders through the courts will be costly for them. Perhaps there will be an informal approach to investors like Bushie to transfer those shares back to them as it would reflect badly on Macquarie to attempt to bankrupt those sort of people. (Bushie (and others) might have to declare all assets before they do so however). It would be just plain stupid for Macquarie to go after small time investors who have made an honest mistake in court IMO. Macquarie I have no doubt started the fire sale and caused the massive destruction in share price. I suspect the other project partners are furious with them. Macquarie could save face and solve the problem by buying back in at a much lower price then they sold for. And like I said before, it may even be good business for them in the long run.

 

[cuttlefish]

Re: Brisconnections shareholders - financial ruin

Cuttlefish it would be very smart for Macqaurie to buy back, but they are under no immediate pressure to do so and can hold off right to April. Thing is they may end up with a lot of those shares and the associated liability anyway. Pursuing shareholders through the courts will be costly for them. Perhaps there will be an informal approach to investors like Bushie to transfer those shares back to them as it would reflect badly on Macquarie to attempt to bankrupt those sort of people.

As far as I can tell it is at Macquaries discretion as to how heavily the shareholders that don't front up for the instalment are pursued - but even if they don't pursue them at all Macquarie will still get the shares of any holders that default for free (and Macquarie will still be lumped with paying the instalments on all of them). The odds are that they will then want to offload those 'second instalment paid' shares to try to recoup some of the expense of paying the instalments.

knowing the liability and prepared to lose a comparatively small investment.

If there was a true market for the shares the stock price would be negative (in my opinion) - therefore if you get shares for free you are not getting anything for free - you are effectively locking in an immediate loss (in my opinion).

People on here have stated that they would be willing to pay people to take their shares - thats a negative share price.

 

[Sunder]

Re: Brisconnections shareholders - financial ruin

I think the huge loss in share price value in 3 months could of removed a lot of that risk.

Are you thinking of this as a $1 share that's lost 99.9% of its value, or a $3 share that's lost 33.32% of its value, and is trying to make a hole in the floor to go lower?

Even if you think a share that has lost 1/3rd of its peak value is low risk, I think Babcock would have been a great investment for you at $20...

 

[Julia]

Re: Brisconnections shareholders - financial ruin

Cuttlefish it would be very smart for Macqaurie to buy back,

Why?

but they are under no immediate pressure to do so and can hold off right to April. Thing is they may end up with a lot of those shares and the associated liability anyway. Pursuing shareholders through the courts will be costly for them. Perhaps there will be an informal approach to investors like Bushie to transfer those shares back to them as it would reflect badly on Macquarie to attempt to bankrupt those sort of people.

You must be joking. Do you really think Macquarie will give a rat's about what 'reflects on them'. They're not a charity. They're a business and their focus should be on looking after their shareholders.

(Bushie (and others) might have to declare all assets before they do so however). It would be just plain stupid for Macquarie to go after small time investors who have made an honest mistake in court IMO.

OK, let's say Macquarie just say: ' oh well, we'll ignore the rights of our shareholders and act kindly towards all the people who didn't understand what they were buying'.
What sort of a precedent would that set?

Macquarie I have no doubt started the fire sale and caused the massive destruction in share price. I suspect the other project partners are furious with them. Macquarie could save face and solve the problem by buying back in at a much lower price then they sold for. And like I said before, it may even be good business for them in the long run.

It's not Macquarie that needs to be seen to be 'saving face'.

 

[Enzyme]

Re: Brisconnections shareholders - financial ruin

What is the SRN and where do I find it?

Sorry Cobber, I missed your reply earlier.

The SRN is the Share Registration Number. It uniquely identifies your share holding. link

It should have been provided to you in the paperwork sent out to you after you purchased the shares. If you can't find it try emailing investors@brisconnections.com.au or registrars@linkmarketservices.com.au or use one of the contact details here for help. (Link Market Services do the share registry for Brisconnections, which is why the links to them).

 

[Enzyme]

Re: Brisconnections shareholders - financial ruin

Just to add to what I said to Cobber, I'm not sure if it makes any difference, but here is a link to the transfer form that Link use: link

 

[TheAbyss]

Re: Brisconnections shareholders - financial ruin

A lot of conjecture about what MacQuarie should do. MQG are have bigger fish to fry at the moment as they focus on selling a few billion more in cash burning assets as they try and retain some semblence of profitability.

Their valuations of assets are being written down reluctantly at the moment and the news will get worse before it gets better for them. The initial valuation of BCS is what caused the problem with over inflated traffic figures etc. No intimate knowledge however i suspect most of MQG assets are overvalued which is why they are being written down slowly, not to mention the contribution from the current financial situation. They sold their loan book to Bendigo and Adelaide banks for $2.9b (retained $500m) and it has been written down $900m already That means their $500m assett is now worth less than $350m. Wait and see what happens to Bendigo bank when MQG start flogging off their stake holding to raise more cash in the next few months.

I cant see them writing any cheques to anyone including BCS stakeholders any time soon. Bright side is they wont want to spend a truck load on legal fees chasing BCSCA holders. Not to say they wont sell the debt to someone and call it a profit.

Any one want to buy an airport road?

Lot to play out here yet and i do hope that something satisfactory eventuates for the shareholders not too mention others such as the Qld Government, Leightons (who wrote down $200m due to BCS very recently) and all others including we Brisbanites who desperately need a decent road to the airport

 

[Rastan]

Re: Brisconnections shareholders - financial ruin

not to go off on too big of a tangent here - but FFS why is building a damned road done via a public company which will charge a toll etc? For goodness sakes we pay so much freaking income tax as well as car registration and fuel tax, now the roads themselves cant even be paid for???

IIRC when the gateway 'paid for itself' the toll was to dissapear, yeh right - thanks politicians - I'm just a little erked as the little guy (the one who has to pay rego and buy fuel) is the one getting squeezed here - we all don't have paid for cars like most of the pollies...

 

[TheAbyss]

Re: Brisconnections shareholders - financial ruin

A lot of conjecture about what MacQuarie should do. MQG are have bigger fish to fry at the moment as they focus on selling a few billion more in cash burning assets as they try and retain some semblence of profitability.

Their valuations of assets are being written down reluctantly at the moment and the news will get worse before it gets better for them. The initial valuation of BCS is what caused the problem with over inflated traffic figures etc. No intimate knowledge however i suspect most of MQG assets are overvalued which is why they are being written down slowly, not to mention the contribution from the current financial situation. They sold their loan book to Bendigo and Adelaide banks for $2.9b (retained $500m) and it has been written down $900m already That means their $500m assett is now worth less than $350m. Wait and see what happens to Bendigo bank when MQG start flogging off their stake holding to raise more cash in the next few months.

I cant see them writing any cheques to anyone including BCS stakeholders any time soon. Bright side is they wont want to spend a truck load on legal fees chasing BCSCA holders. Not to say they wont sell the debt to someone and call it a profit.

Any one want to buy an airport road?

Lot to play out here yet and i do hope that something satisfactory eventuates for the shareholders not too mention others such as the Qld Government, Leightons (who wrote down $200m due to BCS very recently) and all others including we Brisbanites who desperately need a decent road to the airport

Bit ambiguous. The sold the margin loan business for a lot less than 2.9b which was the book value not the selling price. Sorry.

 

[noirua]

Re: Brisconnections shareholders - financial ruin

Whole project looks dead in the water. Best left for better times, maybe around 2016-18.

 

[skc]

Re: Brisconnections shareholders - financial ruin

Bit ambiguous. The sold the margin loan business for a lot less than 2.9b which was the book value not the selling price. Sorry.

err..i think 2.9b was the value of the loan book, not the book value!!

 

[TheAbyss]

Re: Brisconnections shareholders - financial ruin

err..i think 2.9b was the value of the loan book, not the book value!!

Yes. There goes any credibility i had. Can a mod delete the post please.

 

[Julia]

Re: Brisconnections shareholders - financial ruin

Yes. There goes any credibility i had.

No, it doesn't. The rest of your remarks were entirely valid.

 

[awg]

Re: Brisconnections shareholders - financial ruin

I hate repeating myself, but I will anyway

I can see a business opportunity here.

for an individual with looming inevitable bankruptcy.

Form company ( B.U.M Enterprises)

Contact BSC shareholders (from publicly available register, just like David Tweed)

offer to buy shares, charge big fat transaction fee (like Macquarie)

buy as many as you can,

Get legal and accountancy advice first before to make sure no regs are breached.

make hay while sun shines

hello allan bond

 

[prawn_86]

Re: Brisconnections shareholders - financial ruin

Why not do it AWG?

 

[skc]

Re: Brisconnections shareholders - financial ruin

I hate repeating myself, but I will anyway

I can see a business opportunity here.

for an individual with looming inevitable bankruptcy.

Form company ( B.U.M Enterprises)

Contact BSC shareholders (from publicly available register, just like David Tweed)

offer to buy shares, charge big fat transaction fee (like Macquarie)

buy as many as you can,

Get legal and accountancy advice first before to make sure no regs are breached.

make hay while sun shines

hello allan bond

What a catch 22. If you are able to make any money from those transaction fees, than they become assets of the company which will go towards meeting the obligation anyway! Otherwise you will have to move the cash out of the business before the liability fall due. As a company director, I think it is illegal to do that knowing that you have a big debt to be met - so definitely check with your accountant, lawyer, QC etc.