Wellington Capital PIF/Octaviar (MFS) PIF

Re: Octaviar MFS Premium Income Fund PIF

Lawry1dog I sincerely hope you are wrong regarding the outcome of the class action as it appears we have a strong case of negligence against OCV directors and staff as well as KPMG auditors. IMF are not in the business of representing actions that do not demonstrate that there is a very strong case to be answered and I know they did their research before committing themselves. The Federal court also has provision for a 'fast track' proceedure, also known as 'rocket docket' but I do not know if IMF will be using this facility at present. It expediates the case and keeps costs to a minimum. I personally see the class action delivering a positive result and have no choice but to be patient and trust our legal team.
I do not think that the 3 IAG representatives will have access to PIF documents.
I asked WC how the IAG was progressing and was told it had not been finalised at this point.
I asked WC how the marketing capaign of the 11 PIF properties was going and was told that even though there was interest there currently were no contracts locked in.
The PIF is stable and holding its own and financialy sustainable at present with incoming funds matching outgoings. The PIF is not accruing debt.
Was told the PIF is not a 'basket case' and JH will not appease bad press. When there is some positive news to report we will be told.
The financial reports should be available mid Sept.
So nothing much new happening with the Fund.
Regards, Seamisty (PS, are you Great Dame reincarnated LOL?)

Re: Octaviar MFS Premium Income Fund PIF

Hi all,

There's a company announcement for Octaviar on the ASX website dated 7/8/09 (letter dated 5/8/09 from Deloitte's). I tried to copy it to post here but was unsuccessful. It has to do with the sale of the final 35% of Stella.

The last paragraph: "On 5 August 2009, a notice of discontinuance in the Proceeding was submitted to the Court and it has subsequently been filed with leave."

Does this mean they're not going ahead with the final sale of 35%? just putting it on hold? or something else??? I'm not versed in legal speak; can anyone enlighten me?

Also, does anyone know what the outcome is from the Directions Hearing on 5/8/09?

Thanks very much.

Cookie

Re: Octaviar MFS Premium Income Fund PIF

Seamisty,

Congratulations on posting #4000. You always look on the bright side, but as Lawridog knows the shadows are getting longer.

Re: Octaviar MFS Premium Income Fund PIF

I am not Great Dame, feel a bit peeved that you put in me in his league.
Thought he was so outrageous with his comments. Mine are very sublime
compared to his.

I am a Matematician by profession, and as you know Wellington has so many properties in the portfoilio, worth a certain amount on paper. Unless Wellington creates a miracle by investing in some other money making strategy, the unit value will never reach $1.00. Because as you know MFS was receiving fresh deposit money from unsuspecting investors all the time, and so they could maintain a $1.00 unit value.

For Wellington to reach $1.00 again, needs for them to accept deposits again.
But of course this needs the PDS changed. Why does this not happen now?


Regards
Lawry1dog

Re: Octaviar MFS Premium Income Fund PIF

Lawry1dog, thanks for a timely post. Yes we do need to consider where the fund should be headed in the future. In my view, as the current assets are liquidated our fund should move in the direction of a traditional property fund where appreciating and income producing property assets form the core of the fund, rather than the speculative developer finance model which has failed so badly. This type of fund is still paying distributions, some at 8.5%, even though redemptions are frozen.

I do not agree that PIF was a ponzi scheme. Certainly it is much easier to balance liquidity when there is a constant inflow of new capital. Remember, MFS did very well out of the 3+% management fees they were taking as well as all the surplus interest above the interest rate provided to investors - Developers forced to accept 12 - 15%+ repayments on overdue funds. This provision was inserted in the constitution as a success fee by MFS, but it is no longer in the PIF constitution.

The circumstances required to allow new investment into PIF are several: Current assets are near impossible to realise in the current economic climate - there are simply no loan funds for property investors/developers, so nothing moves. There are some overseas investors picking over the bones but so far none interested in ours.The Government's bank guarantee arrangement does not help PIF, and they are reluctant to assist property based funds with perceived "toxic assets". The Government knows that if it guarantees funds like PIF there would be an investor exodus of biblical proportions, leaving the Government holding the toxic assets. There is little investor confidence in funds in our predicament, and the current constitution only provides for replacement investment via the NSX. Therefore, there will have to be a significant positive change in credit markets before PIF can be restructured.

Hopefully the class action will return a significant slice of our investment and that over time PIF can be transformed into a profitable fund. If this happens we will be better off in the long term. Unfortunately we all have to suffer in the meantime.

MARCOM

Re: Octaviar MFS Premium Income Fund PIF

I was joking re the reincarnation Lawry1dog, LOL = 'laugh out loud', so no offense intended but where is GreatDame anyway?
You and Marcom are right to be concerned with how PIF unit value will ever be restored in the current economic climate without new revenue streams in my opinion. I have asked WC on many occassions (and JH herself) what the future strategy is to take the fund forward and have been given answers that refer to 'value adding' , 'maximising existing assets' and returning the Fund to its original purpose of lending money.(Capital raising has also been mentioned) I am totally perplexed as to how this can happen with any income currently generated by the Fund being used to financially maintain itself with nothing left to finish incompleted properties/projects. It's great to hear the PIF has been stabilised/reshaped but where to from here?

When WC initially took on the role of RE for the PIF they were paid a 'one -off' fee from OCV of $750,00 & GST which was the equivalent of one months running costs.(This included staffing, premises, other administrative and management functions and the costs of the forums) WC was also paid an additional $3million for this purpose. I find it highly unlikely that the PIF is generating this type of income so I sincerely hope that this being the case that it does not compromise the ability of WC to manage the Fund successfully. I would have thought these type of questions/issues should have been addressed via an investor update by now. Also the 12 months is up and I am curious as to just how much did it cost WC to accquire the PIF? When WC first became involved with the PIF I was encouraged by JH's credentials and legal background and like others thought that she had exceptional qualifications that would be essential to get the PIF operational again? I am still peeved that the PIF had to pay 20-25% for the interim loan! The following is copied from http://www.wellcap.com.au/finance.html

'Wellington Capital specialises in arranging flexible, innovative financing for both small and large property related transactions.

Our financing capabilities provide one-off tailored solutions to meet our client's specific project requirements and risk profiles. Wellington Capital has a strong relationship with a number of senior debt providers and our corporate team provides a single point of contact and consultation in complex property and corporate transactions.

Through extensive ties with major financiers, Wellington Capital can provide optimally-tailored financing for property developments and projects including securitisation, asset backed securities and general structuring of cash flows, assets and liabilities.

The property based financing projects which the Wellington team have been involved in are diverse, ranging from fund raisings associated with the acquisition of further development of CBD offices, residential towers, commercial and industrial facilities, and large scale sub-divisions.'

Regards, Seamisty

Re: Octaviar MFS Premium Income Fund PIF

Interesting to see that Stuart Price (Stuart Price commenced as Chief Executive Officer of the United Arab Emirates subsidiary 'MFS International Limited' in2007) has severed his tie with Agilis Global where he was also the CEO, the very similar to MFS International Dubai based company managed by former MFS director Phil Adams. No mention of his previous MFS/OCV connection? Stuart Price is also a named respondant in our class action. I hope Kelly and Co is more successful than MFS/OCV Seamisty

Agilis Global boss named new Kelly and Co CEO
By Richard Szabo | Wednesday, 22 July 2009


The CEO of Dubai-based investment banking business Agilis Global, Stuart Price, has been appointed as Kelly & Co's new CEO.

Price was short listed after a global headhunt. "It was important to identify a candidate who embraced Kelly & Co's culture and values and brought skills and experience that complemented the business. Stuart has international experience working in the UK and Middle East, and an acute appreciation of client needs," a spokesperson from the firm said.

Bringing his experience in areas of commercial and banking & finance law, Price has also been a business executive entrepreneur in the banking and funds management industries.

Re: Octaviar MFS Premium Income Fund PIF

I do not know who Lawry1dog is but can confirm he is definitely not Great Dame.

Great Dame is a very sick man , he sold his shares on the NSX some time ago for 20cents which just proves he was in fact a lot smarter than the rest of us poor souls who still have to suffer every time we look at that wretched Index . It will be a long time before we see 20 cents again on the NSX methinks.

Re: Octaviar MFS Premium Income Fund PIF

Seamisty, Has Price been served yet?

Re: Octaviar MFS Premium Income Fund PIF

I am definitely not Great Dame.

I hope Wellington is not using our money to pay PIF staff and thus deny us the 3c distribution. I do not want to keep people employed at my expense!

It is about time Wellington, borrow or do whatever and pay us the 3c distribution now, and then sell all PIF assets over the next year or so, and then divide the proceeds to us PIF unitholders equally. Of course sell at realistic prices.

And then hopefully the Class action, will then provide us with the balance owing to us, with maybe a bonus, for hardship over the last 2 years.

I think all unitholders just want there money back and get on with life again.
We should not be held to ransom by Wellington, who maybe just
using our fund to keep them in job and a mansion.

Can the 3 AG members please think about this proposal.


Regards
Kalvin

Re: Octaviar MFS Premium Income Fund PIF

marcom said:

Seamisty, Has Price been served yet?

Click to expand...

I am not sure Marcom but the lawyers are aware he is back in Australia and his new employment position, so if he hasn't, he will be!!!
Lawry!dog, no one knows who the 3 IAG representatives are at this point. Seamisty

Re: Octaviar MFS Premium Income Fund PIF

Too true Seamisty. We've seen none of the benefits of the Hutson magic of doing deals. Just comments about tough conditions.

Maybe it's all going on behind the scenes. But that doesn't help the share price.

In the light of CVC's bully purchase of the last 35% of Stella, she certainly seems to have been spot on that the 22c offer last year was a good deal. CVC totally outplayed PIF and the other creditors on that deal.

Somehow I expected voluntary administration to deliver a more favourable outcome than straight out liquidation. How could the outcome of liquidation have been any worse for PIF and OPI Pacific investors and PTQ's note holders than this VA under Deloitte?

As for Deloitte's crumbling to CVC's gun to our head tactics, how about this for some more infuriating truths about Stella from the Australian on 4 August:

"About half of the group's assets are in Britain and it is that British expansion from 2005 that is understood to have been most costly for the group, with spending on accommodation and travel plunging into the economic downturn. ...

Stella Hospitality Group's chief executive, Bob East, said the market remained challenging, but the long term debt arrangement meant the company could focus on operational growth and was "cautiously optimistic" about the future.

"The corporate market is still challenged," Mr East said.

"Sydney has been a challenging market." Mr East said that while the travel business was "doing it tough", he expected conditions to stabilise."

But somehow CVC have been convincing in arguing that their losses were OCV's fault. That OCV should have been able to forecast the great recession.

Re: Octaviar MFS Premium Income Fund PIF

Hi Duped, Cookie1 posted (post4001) "On 5 August 2009, a notice of discontinuance in the Proceeding was submitted to the Court and it has subsequently been filed with leave."

Does this mean there is a slim chance that the remaining 35% of Stella may NOT go to CVC? And yes, I would have much preferred 22c under the proposed OCV DOCA. Meanwhile the OCV coffers continue to shrink, swallowed up by fees. Seamisty

Re: Octaviar MFS Premium Income Fund PIF

Seamisty, I think this refers to the discontinuance of the CVC action against Octaviar - therefore the sale is to proceed subject to "a number of conditions, including regulatory approvals (this is probably Foreign Investment Review Board approval) which are required to be satisfied by 31 August 2009."

This was all handled by the Administrator (Deloittes) and the Liquidator (???) may or may not take a different view of the 35% sale (and indeed the original 65% sale) based on decisions on insolvent trading.

Re: Octaviar MFS Premium Income Fund PIF

Seamisty. My guess is that the leave is merely a formality to allow for the FIRB to do their thing. I recall reading that the takeover of Stella by the foreign CVC would require Fed approval.

I've seen nothing from Deloitte that indicates they have any intention of not handing the rest of Stella over to CVC. And I certainly haven't seen anything at all which suggests that the Federal Government will do anything whatsoever to stop us PIF investors get screwed over - again. Maybe we'll get a pat in the back and a 'there there, yes it was a horrible thing that those nasty boys did to you at school' from the Ripoll inquiry. But that's all I see on the horizon from our $320BN a year governments. In fact from what I've seen it's the opposite, they seem to think we were all greedy.

I had a misguided desperate hope that the 65% sale to CVC may be voidable but selcipher's post #3990 dashed that. http://www.worrells.net.au/factsheets/Liquidation.htm. See

"If transactions appear improper, uncommercial or to have been undertaken to defraud creditors, that property or its value may be recovered from the recipient. The liquidator may also recover money from creditors who have received payments that gave them 'preferential' treatment in the six months before the liquidation."

The sale to CVC may have been stupid, idiotic, moronic and desparate. (Smashing OCV's position in Stella in a completely pointless and futile attempt at avoiding to have to come clean) CVC may have taken advantage of a desperate and pathalogically proud seller. But is any of it 'improper' and 'uncommercial'? I don't know. Did CVC 'defraud' OCV's creditors? How do you prove something like that? Especially considering that CVC seems to have been able to be convincing enough for Deloitte to concede that OCV mislead CVC in the deal.

By the way, if CVC's $600M of claims against OCV for its 65% share of Stella are fair then Stella is worth up to $1.1BN. (Remember CVC paid about $1.3BN - $400M cash + assumed $900M UBS debt. This valued Stella at $2BN.) Meaning Stella dropped from costing $2.4BN to put together in a bubble to $1.1BN in the depths of the Great Recession. A drop of 54%. Not unreasonable is it, given the difficult conditions and that Stella provides services that are a highly volatile discretionary purchase? If so then how is that OCV's fault?

Re: Octaviar MFS Premium Income Fund PIF

Thanks Duped and Marcom, Your input is much appreciated. The liquidation of OCV should not take long as there is very little left to 'liquidate' it seems. Seamisty

Re: Octaviar MFS Premium Income Fund PIF

Duped, I see your point - even if both sales are voidable through insolvency it looks like it would still be a very difficult (and expensive) case to argue.

I still can not find anything on McMurdo's directions last week, or any formal appointment of a Liquidator.

Re: Octaviar MFS Premium Income Fund PIF

I'm not really sure Marcom, I'm guessing that the 35% sale could possibly be voided relatively easily if challenged. I'm guessing that Deloitte would be well aware of the risks. I.e. the risk of being sued by us creditors for not fighting CVC on this against the cost of fighting CVC in court. Costs that Deloitte would have to outsource to a law firm? What's in it for the liquidator/administrator? I'm also guessing that CVC are also well aware that Deloitte are aware of the position. After all Deloitte is an accounting firm and CVC have their own accountants who play in the same court. CVC are playing hard ball business (a-la Donald Trump's The Apprentice) and there's no one really out there with any inherent motivation to be our muscle. CVC know that too. Maybe the initial $270M? claim wasn't a big enough knock on the head so CVC stepped it up to $600M. That's our system for ya IMLO. A game of poker. Blind man's bluff. It's quite sad really. But maybe I'm wrong. But if so, then whoever gave OCV's last sets of books the tick have got some embarrassing questions to answer - if anyone will ever get around to asking for an answer.

Re: Octaviar MFS Premium Income Fund PIF

All sounds good, the information coming from duped, marcom, etc, but it does
not get our money back.

I think it is about time we took things into our hands, and somehow make Wellington tell us what exactly they are doing. For instance:-

1. How many staff have they employed in our fund and how much are they being paid, including the CEO.

2. Give a statement on what assets are in the fund, and the condition they are in.

It is our fund, and we should have a vote on Wellington, to force them to give us the information. I was hoping the 3 AG members would do that.

I wonder if I can get the unit holders mailing list from Carneys or IMF, so I can
contact all unitholders. I am will to pay for this mail out.

I feel since the QLD Supreme court rulling, something must be done now or we miss our chance. I am going to pursue other people and media on this, and force Wellington to come clean. I am starting with NewsCorp.

Also it is a bit distressing to see other people on this forum, who seem to know more information than the rest, or do they ask more questions.
Wellington should be telling us, not coming third hand.

Hope other people can help me out.

Regards
Lawr1dog

Re: Octaviar MFS Premium Income Fund PIF

lawry1dog said:

All sounds good, the information coming from duped, marcom, etc, but it does
not get our money back.
Also it is a bit distressing to see other people on this forum, who seem to know more information than the rest, or do they ask more questions.................
Wellington should be telling us, not coming third hand.

Hope other people can help me out.

Regards
Lawr1dog

Click to expand...

Hello lawry1dog,
Hopefully you received PIF AG e-mail update from breaker of 12 August.
It may remove some of the frustrations felt by us all.
However, not so long ago, we felt much greater frustrations at having no FORUM access at all.
Since "resurrection", we are more then ever aware of the special attention Moderators are paying to this site. The above remarks (accents added by me) may be seen as inflammatory and incorrect. Wellington's site is http://www.newpif.com.au/ and Federal Courts site for our case is
https://www.comcourts.gov.au/file/Federal/P/NSD324/2009/actions.
The latest info available can be followed there; with PIF AG and PIFI
updates complementing. You will agree that these sources can not be classed as "third hand".
I will be among the first to sign up to any actions you may initiate, as long as they are not detrimental to current efforts made on our behalf.
With best wishes, simgrund