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MFS - MFS Limited

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Commiserations to MFS holders. I had BKN which was a bolt from the blue similar to this.
Expected BKN to recover somewhat but sold it last week at 52% less than I paid for it - by far the biggest loss ever. A far cry from your profit, Prospector, even though I know you gave back considerable paper profit.

Thankfully I sold MFS late last year.
Hope you get at least an interim bounce for those who want to get out.
 
I have spent 20 minutes looking into this saga.

All I can see is that MFS want to split there business, and basically raise money so that one half of the company does not carry any debt.

Lets just say this split does not take place, due to the negative reaction from shareholders and business goes on as usual.

It would then mean MFS continues in the same fashion that got the share price as high as $6.00

It would continue to pay dividends of 20 cents, and have earnings per share of 48 cents.

Surely major shareholders would want this to occur?

From what I can see there has been an over reaction in companies that carry debt.

But that is probly a very simplistic way of looking at it.

I would love to see where MFS is in 12 months time. I am not going to compare it to CNP or Rams because from what I can tell they are totally different businesses that have been flogged due to the US sub-prime debt market saga.

Am I missing something?

Have the fundamentals of MFS changed?

I think theres a chance if the US market bounces which I believe it will, then MFS could well put on 20-30% but looking at CNP, I wouldnt be holding if you bought on close.

Good luck, seems like a gamble until the story unfolds.
 
Julia said:
Commiserations to MFS holders. I had BKN which was a bolt from the blue similar to this.
Expected BKN to recover somewhat but sold it last week at 52% less than I paid for it - by far the biggest loss ever. A far cry from your profit, Prospector, even though I know you gave back considerable paper profit.

Thankfully I sold MFS late last year.
Hope you get at least an interim bounce for those who want to get out.
Click to expand...

Julia, sorry to hear about your loss with BKN.

I think there is a good chance for a bounce (an automatic rally), something along the lines of what happened with AED & CNP, just be quick to get out if given the chance.

My best guess atm is that Monday will see another test of 80c or maybe a probe lower before some sort of rally, which like CNP could last 1-2 days or a number of days like AED, will then be looking for a blow off top to signal the end of the rally and eventually another test of the lows.

For discussion only. Please DYOR. Good luck to holders.
 
Julia said:
Commiserations to MFS holders. I had BKN which was a bolt from the blue similar to this.
Expected BKN to recover somewhat but sold it last week at 52% less than I paid for it - by far the biggest loss ever. A far cry from your profit, Prospector, even though I know you gave back considerable paper profit.

Thankfully I sold MFS late last year.
Hope you get at least an interim bounce for those who want to get out.
Click to expand...
well i bought PEM at 3.40 and sold at 1.93 after believing it would turn around,. I sold and I am glad because they have dropped anothe 20c and they are still going down....
 
I hope anyone that held MFS didn't have much quantity in it.

I had 2000 at around $5.50 thinking it was a nice correction from $6.80 or whatever but I got stopped out and then decided a golden rule = only big caps.

Jeez sunk under $1 today, in the newsroom where we work we were quite stunned as MFS did invite our team to golf on one occasion lol.

This US sub-prime thing has been a tragedy for so many people.
 
I bought only 1000 at $3.40 very recently and am in total shock and what has happened. I did some quick research before buying and did not find anything to warn me about what was to happen today! Amazing and awful.

I almost bought more at .70c but was too busy and then when I had a minute to spare they were up to 99c again and then I was too uncertain and decided to leave them alone and just hope my $3.40 shares one day pick up
 
I am left holding 6500 averaging in at $2.77...but sold 12000 at $4.60 months ago.After that they went over $6...sounds pretty good now,at the time I thought that I timed it very badly.
When I went for a walk with my dog last night I asked him what he thought of the MFS demise and he said that the only positive that he could see was that for every seller there is a buyer....and unless there is an unexpected change that they have to be dreaming if they want to raise $550 million from shareholders.
The dog was born blind,but he has other attributes...a moist and tender Coles chicken for him today.
 
There may be more sellers than buyers at times, so not quite true that for every seller there is a buyer - your dog needs a re-think.

On further checking information it appears that MFS is roughtly about $1 bill in debt and not just the $150 mill they have to pay up on in a few months. Its amazing how cocky management was/is to accumulate assets by incurring such incredible liabilities. It doesn't make any sense really except to call it 'greed' to be the biggest.

Hopefully management does not need to rely on the $500,000 raising as they obviously won't be able to do it and announcing this prospective raising has spooked its investors and caused the panic selling. Some brokers apparently are telling their clients that it will all be ok and not to sell. I can't help wondering if these brokers are receiving commissions from MFS or some personal agenda in giving this advice, or maybe they are simply right on.

I am wanting to think all will be well and the panic is unwarranted - the SP is terrible relative to what it was but that will not affect the company's performance at all except for the fact that capital raising by issuing more shares won't be an option in these circumstances. I hope that they don't depend on this for their continuing viability, my goodness what a shock.






robert toms said:
I am left holding 6500 averaging in at $2.77...but sold 12000 at $4.60 months ago.After that they went over $6...sounds pretty good now,at the time I thought that I timed it very badly.
When I went for a walk with my dog last night I asked him what he thought of the MFS demise and he said that the only positive that he could see was that for every seller there is a buyer....and unless there is an unexpected change that they have to be dreaming if they want to raise $550 million from shareholders.
The dog was born blind,but he has other attributes...a moist and tender Coles chicken for him today.
Click to expand...
 
After my comments, and unable to find out more about the teleconference at the time, I bought in at $1.26 thinking a bargain, then watched as MFS got slammed. Now hold 5800 @ $3.12. Pray there is a bounce, and that M King confirms the company can support itself without the $550 million raising.

Stories at SMH, AFR websites give M King a real thrashing.
Good luck all.
 
vida said:
There may be more sellers than buyers at times, so not quite true that for every seller there is a buyer - your dog needs a re-think.

On further checking information it appears that MFS is roughtly about $1 bill in debt and not just the $150 mill they have to pay up on in a few months. Its amazing how cocky management was/is to accumulate assets by incurring such incredible liabilities. It doesn't make any sense really except to call it 'greed' to be the biggest.

Hopefully management does not need to rely on the $500,000 raising as they obviously won't be able to do it and announcing this prospective raising has spooked its investors and caused the panic selling. Some brokers apparently are telling their clients that it will all be ok and not to sell. I can't help wondering if these brokers are receiving commissions from MFS or some personal agenda in giving this advice, or maybe they are simply right on.

I am wanting to think all will be well and the panic is unwarranted - the SP is terrible relative to what it was but that will not affect the company's performance at all except for the fact that capital raising by issuing more shares won't be an option in these circumstances. I hope that they don't depend on this for their continuing viability, my goodness what a shock.
Click to expand...

Vida
I couldn't agree with you more about the rapid rate at which they debt financed their purchases. To be frank, I never liked this Companies strategy - I mean a tourism business bundled with investment style entity never made sense. Add to that the fact that their unlisted satellite funds are primarily into fixed interest, which obviously would be under pressure in this environment.

However, in regards to your point about hoping that MFS didn't need the money from the flagged rights issue (which coincidentally now is as big as their market cap!), I think the reality is that they can't do with out it - only a desperate Company raises money in a market that the **** has fallen out of. I would stress to anyone who was thinking about picking up a bargain, I think there is much more pain to come, these guys have been on a binge and is not feeling very well atm.

My condolences to anyone left holding this stock yesterday - clearly your board has not fulfilled their continuous disclosure obligations, because there should have been something announced well before this blood letting about the Companies financial position. Add another potential class action to the list.

Cheers
 
I bailed - I had to get rid of the stress of just wondering what will happen next, and now seem to have wiped out any capital gains I have crystallized this year (still in paper profit over all though, thank god!) so maybe this means I wont be paying any CG tax this year :eek: There it is again, my new favourite icon :eek:

There seems to have been some shareholder manipulaton going on about debt levels. Interesting. I am hands up for a class action, even if it was just to cause them some sleepless nights. And threat of jail. Insider trading maybe? - the sp has been very slowly hemorraging in the last couple of months, but really not enough to warrant any real scrutiny.
 
vida said:
There may be more sellers than buyers at times, so not quite true that for every seller there is a buyer - your dog needs a re-think.

On further checking information it appears that MFS is roughtly about $1 bill in debt and not just the $150 mill they have to pay up on in a few months. Its amazing how cocky management was/is to accumulate assets by incurring such incredible liabilities. It doesn't make any sense really except to call it 'greed' to be the biggest.

Hopefully management does not need to rely on the $500,000 raising as they obviously won't be able to do it and announcing this prospective raising has spooked its investors and caused the panic selling. Some brokers apparently are telling their clients that it will all be ok and not to sell. I can't help wondering if these brokers are receiving commissions from MFS or some personal agenda in giving this advice, or maybe they are simply right on.

I am wanting to think all will be well and the panic is unwarranted - the SP is terrible relative to what it was but that will not affect the company's performance at all except for the fact that capital raising by issuing more shares won't be an option in these circumstances. I hope that they don't depend on this for their continuing viability, my goodness what a shock.
Click to expand...

Guys, lets get the facts correct please.

They have never hidden the fact that they have 1.4 to 1.5 bn debt. That only matures between 2010 & 2012. The 150 mil matures in a few weeks and they can pay that with cash. So, please don't compare these guys to Centro of Rams as they are nothing alike.

The entitlements issue is so that Stella can pay back MFS whatever they owe them. It makes for a clean separation of the two entities and makes any mergers or sell, be they with City Pacific or anyone else easier to execute as their finances wont be all mixed up.

There is no issue at all here. Even with Barclays doing a bit of a sell off, i wouldn't be surprised if they Merrill or UBS bought back in at a discounted price on all the panic.
 
what you said does make sense and it is pretty much what the company is saying and some brokers around the place seem to be in agreement, so perhaps that is exactly the case and the panic selling is unwarranted.

I hope you are right and that the current SP is simply a market aberration but I read somewhere that the Rivkin guys are saying that some of that long term debt is being called up by the lenders now and that is the real problem. They are not sure this is the case but they are suspecting it may be. Can this be the case? Can the long term debt suddenly need repayment now?

I am preferring to take your version for obvious reasons and its better for my blood pressure even though I only had $3,400 invested it is a lot to me and for that to become $999 overnight and which could worsen, is rather irksome.

Lets see what happens next week and hopefully people will get more information and disclosure and regain confidence in MFS which is what is missing at the moment. Anyway the Stella business side of it is doing well I believe (apart from the debt owed to MFS) and I stayed at one of their resorts (Mantra on Aqueous) in Port Douglas last November, it was divine.

CranG said:
Guys, lets get the facts correct please.

They have never hidden the fact that they have 1.4 to 1.5 bn debt. That only matures between 2010 & 2012. The 150 mil matures in a few weeks and they can pay that with cash. So, please don't compare these guys to Centro of Rams as they are nothing alike.

The entitlements issue is so that Stella can pay back MFS whatever they owe them. It makes for a clean separation of the two entities and makes any mergers or sell, be they with City Pacific or anyone else easier to execute as their finances wont be all mixed up.

There is no issue at all here. Even with Barclays doing a bit of a sell off, i wouldn't be surprised if they Merrill or UBS bought back in at a discounted price on all the panic.
Click to expand...
 
CranG said:
Guys, lets get the facts correct please.

They have never hidden the fact that they have 1.4 to 1.5 bn debt. That only matures between 2010 & 2012. The 150 mil matures in a few weeks and they can pay that with cash. So, please don't compare these guys to Centro of Rams as they are nothing alike.

The entitlements issue is so that Stella can pay back MFS whatever they owe them. It makes for a clean separation of the two entities and makes any mergers or sell, be they with City Pacific or anyone else easier to execute as their finances wont be all mixed up.

There is no issue at all here. Even with Barclays doing a bit of a sell off, i wouldn't be surprised if they Merrill or UBS bought back in at a discounted price on all the panic.
Click to expand...

Crang
Where do you get your maturity dates from, because the financial statements in June 2007 were deceptively vague - they classified their investment in the Stella group as held for sale and didn't disclose anything in relation to maturity dates or interest rates on 1.4 Bil worth of debt. Reviewing all announcements and presentations, they haven't said a word about their debt in Stella, even when they were price queried by the ASX. I suspect that they debt holders are looking for their money back.......

Barclays aren't stupid - they wouldn't be dumping the stock because they were just worried about market exposure, there must be legitimate reason for doing so and it would appear obvious that it is the debt relating to Stella...

All the best.
Cheers
 
vida said:
I bought only 1000 at $3.40 very recently and am in total shock and what has happened. I did some quick research before buying and did not find anything to warn me about what was to happen today! Amazing and awful.

I almost bought more at .70c but was too busy and then when I had a minute to spare they were up to 99c again and then I was too uncertain and decided to leave them alone and just hope my $3.40 shares one day pick up
Click to expand...
If it makes you feel any better (probably not;)) I'm in almost exactly the same position as you are. We're small fry compared to some out there, and on top of that there would have been others that bought on the way down thinking they could even themself out with a decent bounce. The thought crossed my mind but I decided against it, glad I did.
 
I am sure within any financial loan contract there is a line which says the loan is payable on demand if circumstances arise. If ever the environment was ripe for a 'payable on demand' demand, then methinks maybe this is what is happening! Just my :2twocents and with no knowledge to back any of this up.
 
What will happen to MFS if this is the case, that the long term debt is being called up for payment now? Will it mean the demise of the company asap?

Prospector said:
I am sure within any financial loan contract there is a line which says the loan is payable on demand if circumstances arise. If ever the environment was ripe for a 'payable on demand' demand, then methinks maybe this is what is happening! Just my :2twocents and with no knowledge to back any of this up.
Click to expand...
 
how I'd like to think of it is. why would a loan be called forward and then the financial institution possibly taking a discount rate to get their loan back, because the chances of MFS repaying the complete loan in full would be low.

would the bank just cut their losses? or wait it out, collect the interest on the loan and then eventually get their whole loan back.

i think CNP is in a much worse position than MFS and their due dates will most likely be extended so that the banks can recover most/all of their money. i'd like to think this would be the same case for MFS, rather than the lenders say give me my money back today
 
chicken8 said:
how I'd like to think of it is. why would a loan be called forward and then the financial institution possibly taking a discount rate to get their loan back, because the chances of MFS repaying the complete loan in full would be low.
Click to expand...

But we all know the share market trend is far more than logical thought. Just even the possibility would be enough to make all this happen.
 
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