Wellington Capital PIF/Octaviar (MFS) PIF

Re: Octaviar MFS Premium Income Fund PIF

Hi Seamisty,

You need to download (save) the files from this forum to your PC and attach to a new email message. It depends on your email client as to how you attach a file. Most email clients use a pic of a paperclip on the attachment tool.

If you want to send an email to the Brisbane mailbox I can reply with the files attached.

Regards,
Dora.

Re: Octaviar MFS Premium Income Fund PIF

Good morning all

A few comments and a few questions.

The four pages of information posted seem to have mostly self promotion on WC and JH and very little dedicated to real financial information. Pictures of JH and a quote from a US president ???

It seems like a gun is to be put to your head in august saying accept WC or liquidate. The reason that the PI cover was glossed over I am guessing is that as WC has taken control of the existing RE they would have to sue itself to get at insurance.

This is why IMO the RE must be replaced either by other WC RE or third party. $50 million guarantee is now due and payable by OCV as default clause has triggered so changing RE would not remove OCV obligations.

I am not sure about six other parties been invited to make an offer as JH herself stated in AFR that "no one else got close to doing due dilegence" so only one group was allowed inside the castle and all other parties had to make an offer basically blind.

I dont think JH is been truthful about this part as I know one of the parties who had expressed an interest was not a vulture and had available significant resources to rebuild value but that is another story for another day.

Questions

RE fees - on what basis is the fee to be paid
0.75% on original value or on 45 cent estimated value of unit. This is a difference on fees from 5.6 million to 2.3 million and when the fund is not profitable every cent needs to be counted ?

Other costs - is the RE entitled to other expenses from the fund and what other costs come out of the fund. (audit NSX listing etc) ?

To rebuild value is this allowing existing investments to mature or is it the reworking of funds into other investments to get capital gowth ?

In retiring bank debt what losses have been suffered as I note reference is made to assets sold at "market value" ?

What fee has PIF agreed to pay Artic in relation to LLA and what is the overall loss estimated on this loan to be ?

Did WC approach any other interested parties specifically on LLA to take over Artic position and allow PIF to be vulture fund instead of the victim ?

At what stage did JH and WC become aware of 147 million loss. Korda Mentha had been in OCV for months when Chris Scott and his advisor WC arrived. JH became a director and took option on acquiring RE. Exercised the option and then found out true position ?? The timing of this does not stack up and it has baring on PI claim which at $20 million is not to be sneezed at ?

If someone could have a crack at asking these questions it would be appreciated.

Re: Octaviar MFS Premium Income Fund PIF

flatback said:

I agree breaker1 let JH respond to the question (will these payments be called part redemption or distributions, i believe they cannot be termed distributions when in all probability the payments are going to come from our CAPITAL i have said before that we must take a very practical approach to this issue we as a group of concerned investors must think with our heads and not our hearts,we cannot have our members standing up like rabble at these meetings beating their chests, please be rational, if any person in our group cannot understand (and there are many) fear makes people say and do things that you would not normally say or do (we are all angry) but we must put that anger to good use and correspond through this forum with ideas that are constructive DROP the negative.
cheers Flatback

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It amazes me that so many people who attended the Brisbane meeting are still debating whether the payments promised by Jenny Hutson are INCOME or CAPITAL. She initially said they were "distributions" but when my wife challenged that Jenny corrected herself and clearly stated the first two 3 ¢ payments were to be CAPITAL RETURN.
The problem is that a lot of people seem to have a very short attention span and after the coffee break more than half of them left. That is why there is so much confusion.

Re: Octaviar MFS Premium Income Fund PIF

Having read all the posts re. the Brisbane meeting,
I can only notice that no contributors can come up with alternatives to the WC propositions. I mean what is left for the AG to do? Are any of our previous ideas still relevant? If the AG raises money what is to be done with it? Should we set our sights on pursuing the people who have caused us distress? Is there any action open to us to recover lost money? It looks like these missing funds have disolved into thin air. Nothing seems to have changed since JH's interview with Breaker sometime back, except that the road to any sort of decent recovery (say 70 - 80 cents) looks more distant than ever, even impossible. So, what do we now do practically? Hope that I'm wrong, but do I sense a gloomy mood of resignation growing among us? If anybody can make my day brighter, they'll tell me that there's still a battle to fight.

Re: Octaviar MFS Premium Income Fund PIF

Tuart's very recent post sets out possibilities! Thanks, Tuart.

Re: Octaviar MFS Premium Income Fund PIF

Tuart said:

At what stage did JH and WC become aware of 147 million loss. Korda Mentha had been in OCV for months when Chris Scott and his advisor WC arrived. JH became a director and took option on acquiring RE. Exercised the option and then found out true position ?? The timing of this does not stack up and it has baring on PI claim which at $20 million is not to be sneezed at ?

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Jenny said they took option to acquire RE before they became aware of the MFS loss. Something about needing to rush to prevent liquidation.

Good luck Melbourne guys! I actually think you might be better off only asking one question at a time otherwise Jenny tends to skip over the hard part. She will often talk about the subject you bring up but not directly answer the question.:disgust:

Re: Octaviar MFS Premium Income Fund PIF

This article from today's Australian written by the Chief Executive of the Australian Shareholders Association is interesting. He is not a fan of Wellington.

Thanks to those who have & will post information on the meetings.

Re: Octaviar MFS Premium Income Fund PIF

Jenny said:

This article from today's Australian written by the Chief Executive of the Australian Shareholders Association is interesting. He is not a fan of Wellington.

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Title of article seems to be quite alarming.

"Forget life support, put it down"

http://www.theaustralian.news.com.au/story/0,25197,23984530-30538,00.html

Re: Octaviar MFS Premium Income Fund PIF

Tuart, JH said that PIF debt to LLA is 2nd in line behind NAB's $125M. I don't know what LLA is worth but suspect that Peacock/King/Hutchings put WC in this miserable bargaining position. Think about it all of you. Do you think NAB cares about us? NOOOOOOOOOOOOO WAY.

There is another option. Another RE. Who then? There's still nearly HALF A BILLION dollars of value in the fund. I'm speculating but even the big 4 don't snub such numbers. They can read this forum just like you and me. And then there's the Financial Advisor Industry with a lot to lose in reputation from the Peacock/King/Hutchings shenanigans. They could (and in my opinion SHOULD) spread the word to potential suitors. But have we seen any other offers: NO.

Think big picture. Banks pay depositors around 7.5% and charge lenders around 9.5%. The 2% difference goes to operating costs and SHAREHOLDERS. In my opinion the service our RE provides is similar. At HALF the cost to us depositors. Albeit there's more risk; which JH acknowledged. JH said she is a mrchant banker.

The 3c+3c IS a return of capital. JH made that clear in the Brisbane forum. WC is effecively offering to REDUCE the funds under management by over $50M. JH in NO WAY hid the fact that she and WC are in the business of being in business. Even when directly asked if the 14c liquidation value was contrived to scare us into voting for WC. Can someone ask JH at the next forum if WC will offer unit holders the option to NOT receive the 3c + 3c. I.e. to convert it to more units and hence a greater % of the fund. That way, those who want to go with WC can increase their % of the PIF and those who don't can gradually step out.

JH also made it clear she was involved with setting up the PIF. So if anyone is looking for a conspiricy or alterior motives then perhaps she wants to restore PIF's reputation. Not a bad thing for unit holders. She voiced the opinion a few times that it was a great fund. The question is of trust; hence the slide show presentation.

Re: Octaviar MFS Premium Income Fund PIF

That's right Duped at this stage no-one else has stepped up to the plate that wants to take this vehicle forward. Tuart keeps mentioning he knows of a consortium, with big bucks etc etc..so where are they? If they are that wealthy then they could smash the likes of JH..but where's the offer..show me the MONEY. Money talks and b.s walks!!!

Re: Octaviar MFS Premium Income Fund PIF

Thanks duped. So we are clear on the fact that there will be two 3cent distributions before the end of the year which will be paid from our own capital.OK, I can live with that but what happens after that? Will the future quarterly payments be made from our own capital as JH sells off assets from the PIF or come from income generated from the remaining assets?Thanks, Seamisty

Re: Octaviar MFS Premium Income Fund PIF

None of us should overlook this article in today's Australian (already pointed tot by Jenny and others.). The writer is an experienced, objective observer.

http://www.theaustralian.news.com.au/story/0,25197,23984530-30538,00.html

Re: Octaviar MFS Premium Income Fund PIF

Tuart said:

I dont think JH is been truthful about this part as I know one of the parties who had expressed an interest was not a vulture and had available significant resources to rebuild value but that is another story for another day.

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I think the day has come Tuart.

Re: Octaviar MFS Premium Income Fund PIF

Duped

The whole idea of establishing a proper structure for the AG was to have a committee who could meet with other potential managers and return with a recomendation to stick with WC versus other alternatives.

The august meeting to me is a rail road as I believe even if you establish AG and go through a review process there is a 60 day statutory process for members to call their own meeting to force change.

WC will have called their own meeting where JH will give you a choice of 14 cents versus their own agenda. This is putting a gun to investors heads.

If the AG had a formal committee I know of a number of alternative managers that would like an opportunity to meet and present credentials. Then you can bench mark WC against these groups. Who do these people approach now WC ??

As to the question on LLA once the committee is formed I can arrange for the credentials of the consortium who did lodge a formal interest to be provided to the committee which show that they had the resources to deal with RBOS and NAB in relation to LLA which would of put PIF in the box seat in regards to the LLA restructure.

Instead PIF IS PAYING A FEE TO ARTIC FOR THE PRIVILEDGE OF GETTING SOME OF ITS LOAN BACK.

Also as RBOS was not removed PIF took a substantial loss on GPM as well I believe on other assets.

I think RBOS is actually a party to the creation of PIF losses and there is potential to bring action against them. They allowed money to be advanced to LLA when LLA was in default on their NAB loan and PIF was already in default on the RBOS facility. They are now forcing the sale of assets at a loss.

This is why the AG must force full transparency and get a full understanding of what has happened over the last 12 months and what is left in terms of assets in the fund.

WC must accept this or be removed. There are plenty of managers who would love to add 2 to 5 million in fees per annum and perform the role WC got handed in what can only be described as questionable circumstances.

The other issue is how do investors ensure that PIF is best represented in its claims against OCV. Will the committee have an opportunity to review any deal WC will do with JH mate Chris Scott.

There are more choices ad opportunities than liquidation or WC so lets get on with formalising AG.

Re: Octaviar MFS Premium Income Fund PIF

DoraNBoots said:

I think the day has come Tuart.

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Me too.
Mutchy

Re: Octaviar MFS Premium Income Fund PIF

Javier

Seems that as I was writing you were posting. Who do alternative managers approach. You yourself said that you wanted to wait to after WC forums before moving forward with formalising AG into legal structure.

Do the alternatives ring JH ?

Re: Octaviar MFS Premium Income Fund PIF

Bet you are dying to use one of these Tuart
You have been telling us this from the beginning and I agree.
Unfortunately the solicitor seemed to want to wait till after these WC forums before proceeding. Luckily that is only one day away now so I look forward to some feedback tomorrow from the solicitor!

Re: Octaviar MFS Premium Income Fund PIF

Tuart said:

Duped

The whole idea of establishing a proper structure for the AG was to have a committee who could meet with other potential managers and return with a recomendation to stick with WC versus other alternatives.

The august meeting to me is a rail road as I believe even if you establish AG and go through a review process there is a 60 day statutory process for members to call their own meeting to force change.

WC will have called their own meeting where JH will give you a choice of 14 cents versus their own agenda. This is putting a gun to investors heads.

...........

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Let me understand this. What you are saying is that even if we formalise our AG committee we would still have to vote in August to accept WC's planned management of our fund instead of liquidation. Is it then possible once the 60 day period has passed, say sometime in November at the earliest, for the AG committee to call a meeting of unit holders for the express purpose of replacing WC with another RE? What if the resolution in August is framed in language (legalese) which gives WC the unit holders approval to be the RE?

Does anybody else get the feeling of helplessness?
Mutchy

Re: Octaviar MFS Premium Income Fund PIF

seamisty said:

Thanks duped. So we are clear on the fact that there will be two 3cent distributions before the end of the year which will be paid from our own capital.OK, I can live with that but what happens after that? Will the future quarterly payments be made from our own capital as JH sells off assets from the PIF or come from income generated from the remaining assets?Thanks, Seamisty

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I think it was 3c by Christmas and 3c by June 09.

After that? .... WC is asking us to trust them on that. Truthfully, I'd love for JH to be the next Warren Buffet and PIF be the next Berkshire Hathaway with me in there from the start. Reality ... i don't know. One thing I do know, or at least I read, is that Warren Buffet is pragmatic and looks at the numbers while miraculously ignoring hype, cronies, establishment, institutions etc etc. Boring I know but these are traits that JH seems to have. So what if WC shareholders get rich in the process, (we are a reap-what-you-sow economy aren't we? I certainly prefer a meritocracy) so long as JH takes me with her.

Regarding the Australian article 'Forget Life Support, Put it Down' ... another article other potential suitors should have read by now.

Maybe the Australian Shareholders Association can put their money where their mouth is and help find another suitor or help us get an independent valuation. I'll chip in for such a service.

What an irresponsible article anyway, encourage PIF unit holders to sell at the bottom of the market. Ever single thing I've ever read about investing is to never sell at the bottom of a cyle if you don't have to. (Unless of course we're throwing good money after bad). Apparently we're heading towards or at the bottom of the property cycle. Our loss will be someone else's gain.

I'm guessing the ASA is on the side of the OCV shareholders and not the PIF Unit Holders. Crash the PIF and the $147.5M+$50M, i.e. 1/5 of, the claim against OCV shareholders assets all but vanishes.

Maybe ASA is trying to disparage the PIF to keep other suitors away. How's that for a juicy conspiracy theory.

I'm happy for anyone to prove me wrong. I just want my savings back.

Keep it real.

Re: Octaviar MFS Premium Income Fund PIF

Tuart

Your groups have had 2 months to maybe 'leak' something to the press to outline their interest?

What if Stuart Wilson of Australian Shareholders Association was approached to act on our behalf as some sort of assessor for alternitve proposals for PIF's future?

Cheers