CSR - CSR Limited

[qldfrog]

I hold CSR for the last couple of years and have only got bad news from these guys, I got rid of them a few months ago
unless the board and management is changed, I know I will not spend a cent with them:
whatever way sugar,insolation,etc market goes, they always manage to mess up!. just gut feelings and nothing more than my personal opinion...

 

[Garpal Gumnut]

I hold CSR for the last couple of years and have only got bad news from these guys, I got rid of them a few months ago
unless the board and management is changed, I know I will not spend a cent with them:
whatever way sugar,insolation,etc market goes, they always manage to mess up!. just gut feelings and nothing more than my personal opinion...

CSR are a conundrum , but it may be the time to get in if they are about to break up and make the individual elements more profitable.

I'll have a look at a chart tonight and post it.

gg

 

[Garpal Gumnut]

I hold CSR for the last couple of years and have only got bad news from these guys, I got rid of them a few months ago
unless the board and management is changed, I know I will not spend a cent with them:
whatever way sugar,insolation,etc market goes, they always manage to mess up!. just gut feelings and nothing more than my personal opinion...

Looking at the weekly chart you could be correct in your doggie label on CSR.

They are in a downtrend on the weekly and I don't see any upside for them technically.

Support was in the mid 80cents as it was some years ago.

However if you look at the price action from an Elliot wave view, in 2006 there was a wave 1 down, a wave 2 up into 2007 and then a long wave three down from 2007 to March of this year. Wave 4 looks to have completed and it may fall to the 40 or 50 c mark.

The trendline at the right is a worry, the fall is more acute recently.

This is a dog.

 

[noirua]

This is a dog.

The dog prefers not to lay down and die, just like that. The plans to split the company for the second time since 2003 has run into a cloud of asbestos. So it should, as the remaining sugarless CSR Limited is in a more vulnerable position to pay all the court costs and claims going forward. It may be necessary to put another $50 million in the pot as they did a few years ago.

A sad fact all this, but the two new companies will be with asbestos and the other without. The court outcome may take a while yet.

 

[noirua]

Just purchased some CSR stock at $1.745. Following 'The Bull's' publication and agreeing with the possibilities surrounding the sale / purchase of the sugar interests, float, or bid. Worth a punt perhaps, imho.

 

[So_Cynical]

Just purchased some CSR stock at $1.745. Following 'The Bull's' publication and agreeing with the possibilities surrounding the sale / purchase of the sugar interests, float, or bid. Worth a punt perhaps, imho.

Well worth a punt a few weeks ago at around 1.60 unfortunately i was other wise invested so couldn't get in...anyway if they cant win the court case then there's no way a sale could proceed i would think...i mean the same organisations and company's opposing the de-merger would be there opposing the sale on the same grounds, same argument, same result.

 

[noirua]

Well worth a punt a few weeks ago at around 1.60 unfortunately i was other wise invested so couldn't get in...anyway if they cant win the court case then there's no way a sale could proceed i would think...i mean the same organisations and company's opposing the de-merger would be there opposing the sale on the same grounds, same argument, same result.

CSR piled in $50 million a few years ago to bail out the fund built up to cover asbestos claims. Courts are rightly concerned that the remaining CSR unit, without the sugar side, is more vulnerable and uncertainty in covering future claims is a concern. CSR may need to cover this by putting in a further $50 million and Brightside may well raise their bid a bit more to cover it.

 

[noirua]

Present market cap. for CSR is around $2.6 billion at $1.74 a share. The latest offer for the sugar side of the business is $1.75 billion or about $1.15 a share.

No doubt there will be some taxation, a sum - as put aside - for asbestos claims and also about $200 million passed over to CSR Limited on the present uncertain trading side of the business. This should leave about $1.2 billion for shareholder distribution, or 80c a share. [figures from no particular source and self calculated]

 

[noirua]

CSR shares rebounded yesterday after winning an appeal. Talks continue with China's Bright Foods concerning their A$1.75 billion bid for CSR's Sucrogen and renewable energy businesses.

 

[rule1110]

any news on whats happening with the demerger? And any idea's on what this will do to share prices if it goes ahead?

 

[So_Cynical]

any news on whats happening with the demerger? And any idea's on what this will do to share prices if it goes ahead?

The CEO was on lateline Business last nite...The de-merger is going ahead while talks with Brite are ongoing, the Brite mob was in Aust last week having a good look around the sugar mills and apparently were very impressed.

Prob 50/50 as to what will happen next.

 

[noirua]

The CEO was on lateline Business last nite...The de-merger is going ahead while talks with Brite are ongoing, the Brite mob was in Aust last week having a good look around the sugar mills and apparently were very impressed.

Prob 50/50 as to what will happen next.

My favorite Aussie stock at the moment. Especially as Dr Marc Faber is bullish about sugar. Maybe we'll get $2 billion from the Chinese or even more.
Surprised CSR are not at around $2.50 but that says a lot for present markets and lack of confidence in Aussie markets.
Leaves an opportunity in my opinion, humble as it is.

 

[noirua]

CSR share price remains virtually unmoved and still, in my view, massively underrated. The sugar price remains bullish after drought in the Philippines. India's white sugar demand is up 61.4% and ethanol factors seem due to push the price onwards despite reaching six week highs on Friday.

CSR may well have further interest in their Sucrogen and Renewable Energy business. Bright Foods bid $1.75 billion but this may not be nearly enough for this buoyant sector business.
With profits rising I doubt CSR will unload their sugar business under $2 billion and may well be wanting to see nearer $2.5 billion the way things are going.

CSR market cap. at $1.675 a share is $2.537 billion - dividend yield around 5%.

Is the sugar side worth more than the present market capitalisation of the whole of CSR?

 

[noirua]

It does look as if the directors of CSR are going ahead with their share hiving off of Sucrogen despite Bright Foods still having interest in making a bid for this side of the business.

Market still seems to have no confidence in a bidder coming in with an acceptable bid for Sucrogen that the board will accept. Stock price has stayed fairly steady and maybe, just maybe, the time to look very closely at this one whilst there is still time

 

[noirua]

It does look as if the directors of CSR are going ahead with their share hiving off of Sucrogen despite Bright Foods still having interest in making a bid for this side of the business.

Market still seems to have no confidence in a bidder coming in with an acceptable bid for Sucrogen that the board will accept. Stock price has stayed fairly steady and maybe, just maybe, the time to look very closely at this one whilst there is still time

An announcement from the ASX that basically says CSR are still in talks with Bright Food. The reason to stem speculation?

What speculation? Maybe it's thought that Sucrogen is indeed worth far over the original bid by Bright Food of China at A$1.75 billion - one of Dr Marc Fabor's cheap commodity tips is sugar.

Maybe Bright Food are looking for a revaluation of the Yuan of around 10% - 15% and realise any bid needs to be nearer A$2.5 billion.

 

[noirua]

As it turned out, CSR bit the hand-off Bright Foods' subsidiary Wilmar International in accepting their A$1.75 billion bid for CSR's Sucrogen subsidiary. CSR expect A$1.6 billion to be available after taxes to invest in their Aluminium and building businesses.

 

[mr. jeff]

hi noirua,
as you seem to be the most active on this issue of late, are you able to explain (as I don't have much experience in the area) if there is a $1.15 cps bid on CSR's Sugar division, how the maths works. I own stock and have been waiting to see what comes of this offer from Bright Foods.
What are the arrangements with asbestos penalties now and who inherits these at what magnitude, and has there been any recent reported analysis on the value of CSR without sugar?

I own CSR.

 

[noirua]

hi noirua,
as you seem to be the most active on this issue of late, are you able to explain (as I don't have much experience in the area) if there is a $1.15 cps bid on CSR's Sugar division, how the maths works. I own stock and have been waiting to see what comes of this offer from Bright Foods.
What are the arrangements with asbestos penalties now and who inherits these at what magnitude, and has there been any recent reported analysis on the value of CSR without sugar?

I own CSR.

Hi mr. jeff, The asbestos matter seems to have been accepted by the court, and that CSR have funds for claims in the future. CSR put about $50 million into the asbestos claims fund about 2 years ago. There is no way of knowing what future claims may be.

The market values CSR at about A$2.6 billion and CSR see $1.6 billion after tax from the sale of Sucrogen. Valuing the building and Aluminium sides is quite difficult in these markets, though I will have a look and try.

 

[mr. jeff]

cheers noirua.

it appears as though I am lazy, but am working as a fast as an amateur can (!) on getting a handle on the value of the separated (and sugar div. sale) entities. as has been mentioned already, there is a possibility of an entry on this agreement, but that is pure speculation of course unless there are some fairly good solid numbers and assumptions to work with.

will advise if I can help, but note I own them already and have little idea what I am talking about.

 

[noirua]

CSR lifted a bit on news of a cash handout. How much though?, - don't know; but may be up to half at $800 million or 50c a share, later in the year or early 2011.