Wellington Capital PIF/Octaviar (MFS) PIF

DoraNBoots · 23 July 2008

Re: Octaviar MFS Premium Income Fund PIF

RickH said:
It has been interesting reading the comments and I will say again "a little knowledge is very dangerous." Leave the work to professionals.
Regards,
RickH.

Leave the work to professionals

Rick: is that what you told your clients when recommending they invest in the PIF? You can't blame us for trying to keep informed and ask questions. Feel free to elaborate on the "interesting comments" and enlighten us.

seamisty · 23 July 2008

Re: Octaviar MFS Premium Income Fund PIF

It is my understanding that MFS/OCV received $409million from CVC Asia Pacific for the 65% stake in Stella, BUT, an extra $900million of debt attatched to Stella also went with the deal. So when I went to school (ok ok so it was a while ago!) that equates to $1.39Billion for two thirds, so one third would have to be valued at considerably more than $200+mill, even in a depressed market. So DoraNBoots, maybe that is why the value of Stella has not been factored into the liquidation of OCV valuations. Either no one has a clue what it is worth or the true value is being concealed behind un-audited figures. Regards, Seamisty

great dame · 23 July 2008

Re: Octaviar MFS Premium Income Fund PIF

RickH said:
Thank you Seamisty,
Well said.
We do need to follow JH/WC all the way to the NSX, if that is what she wants to do. We cannot split the vote - Remember 75% to continue PIF.
It has been interesting reading the comments and I will say again "a little knowledge is very dangerous." Leave the work to professionals.
Regards,
RickH.:iagree:

Leave the work to the professionals ????? well we all sure did that and now just look at the mess we are in Ney Rick /

Javier · 23 July 2008

Re: Octaviar MFS Premium Income Fund PIF

That's why PTQ is so hell bent on liquidating, because they have a fair idea of the worth of Stella and that the noteholders will get back twice as much as what CS is offering as a cash settlement now.

If the noteholders benefit from the liquidation and a 3 year wait with the sale of Stella..so do we..let the dice roll I say and let the PTQ QC and the courts determine what the best result is for stakeholders and investors not CS.

Duped · 23 July 2008

Re: Octaviar MFS Premium Income Fund PIF

DoraNBoots said:
Can anyone tell my why liquidation figures are mentioned that don't include Stella? Is it possible for liquidation to not include the sale of Stella?

My guess: you can do what ever you want if you control your own liquidation. Anything that your creditors will let you do.

I did some more digging re the value of Stella. In his Chairman's Address at the 7Nov2007 AGM Peacock said "this business, operating under the Stella Group Banner, now generates more than 55% of the company's [MFS/OCV Ltd's] ongoing recurrent earnings" AND
"For the year under review [Jul06-Jun07], MFS reported:

Net profit after tax of $185 million, up 89.9%
Earnings per share of 53c, up more than 23%, and
Total dividends of 28c per share, up from 26c per share despite a doubling of the number of shares on issue

MFS is now firmly a member of the benchmark S&P/ASX 200 index and has a market capitalisation exceeding the $2 billion mark"

No wonder the MFS/OCV Ltd share price went so high if they were paying out "dividends" like that. So if the money for the "dividends" didn't come from Stella, where did it come from? C'mon you financial advisors, tell me.

There's only 3 scenarios IMO:
Stella is worth far more than $645M OR

MFS/OCV Ltd was using borrowed money from the likes of PIF and PAC and the OCVG note holders to pay "dividends" (in effect a capital return). And conveniently jacking up the price of the shares at the same time. This is exactly the sort of BS organisation that I expected my financial advisor to steer me away from. OR

The MFS/OCV Ltd Board and Exec were totally blind sided by the changed market conditions. But isn't that what they're paid to do - to plan and forecast. Well I certainly was planning to reduce my debt and spending in the light of the RBA warnings. The run of interest rate rises and my subsequent reduction of spending was no surprise to me.
Pages 35-36 of the MFS/OCV Ltd 2007 Annual Report - this is what they were paid in cash (shares/options are extra):
Non-Exec Directors TOTAL for all 6:$470K
CEO King : $2.97M
Stella Group CEO: $749K
Adams (resgnd): $1.3M

Deputy CEO White: $635K
CFO: $819K
Hd Corp & Investment Banking: $973K
L&L: CEO $604K
Hd Mergers & Acquisitions: $486K
Intnl CEO: $542K

So with all that high paid fire power, all those bonuses, they were still blindsided?

LPTGUN · 23 July 2008

Re: Octaviar MFS Premium Income Fund PIF

Does anyone have a list of the actual tangible assets that Octaviar controls... have these book values been re-assessed in the current market???

k.smith · 23 July 2008

Re: Octaviar MFS Premium Income Fund PIF

LPTGUN said:
Does anyone have a list of the actual tangible assets that Octaviar controls... have these book values been re-assessed in the current market???

.....re: re-assessing...what about ocv asx announcement 18 July, pg.18..3.2a,3.2b,3.2c? We really don"t know anything!!

DoraNBoots · 23 July 2008

Re: Octaviar MFS Premium Income Fund PIF

Article in AFR today...
View attachment 22659

DoraNBoots · 23 July 2008

Re: Octaviar MFS Premium Income Fund PIF

I found the 9 min audio at the following link from the 2008 MFS EGM on March 28, 2008 in Melbourne entertaining...
http://www.maynereport.com/articles/2008/07/04-1136-6694.html

Some other info that might not be easy to access is attached.
Extract from attached:
"Craig White revealed that the fund has indeed called on MFS to pay up on a $50 million back-up facility but this is being resisted so far. With the more aggressive Paul Manka and Chris Scott set to take control, expect a tough stand on this dispute. "

SPLITPIN · 23 July 2008

Re: Octaviar MFS Premium Income Fund PIF

Javier said:
That's why PTQ is so hell bent on liquidating, because they have a fair idea of the worth of Stella and that the noteholders will get back twice as much as what CS is offering as a cash settlement now.

If the noteholders benefit from the liquidation and a 3 year wait with the sale of Stella..so do we..let the dice roll I say and let the PTQ QC and the courts determine what the best result is for stakeholders and investors not CS.

Javier

Spot on and why should PIF accept anything less also.

Maybe WC should assist PTQ in the action.

Now may be very testing.

Regards

Splitpin

zixo · 23 July 2008

Re: Octaviar MFS Premium Income Fund PIF

RickH said:
Thank you Seamisty,
Well said.
We do need to follow JH/WC all the way to the NSX, if that is what she wants to do. We cannot split the vote - Remember 75% to continue PIF.
It has been interesting reading the comments and I will say again "a little knowledge is very dangerous." Leave the work to professionals.
Regards,
RickH.:iagree:

Hi Rick,

I see that you have been pushing for the NSX listing for quite a while and I was wondering if there is something you may know that we all dont.

Perhaps you can answer me/us some questions that Wellington have failed to supply me regardless of the amount of times I have requested a response since Ive e-mailed and followed up with phonecalls since the 9th of July

I, like many, cant say that the NSX is bad or good unless we know all the pro's and cons associated with listing it. I mentioned to Jenny at the forum that it remains a very grey area for many investors and she said she would supply information in that respect and the way the NSX question would be asked.

Please share whatever info you have because at this moment. I have no idea which way forward is regarding the NSX and the way the question will be submitted to investors.

Cheers

breaker1 · 23 July 2008

Re: Octaviar MFS Premium Income Fund PIF

OPI Pacific Finance to oppose liquidation of Octaviar
Wed, 23 Jul 2008 8:41a.m.
The directors of OPI New Zealand are heading to the Supreme Court in Brisbane tomorrow to try to stop Queensland's Public Trustee from liquidating 38.8 percent stakeholder Octaviar.

Queensland-based property and finance company Octaviar owes millions to OPI New Zealand's subsidiary OPI Pacific Finance.

The Public Trustee is taking legal action on behalf of Octaviar's listed noteholders who have $A348 million ($NZ451 million) tied up in the troubled company.

If liquidation proceeds, OPI Pacific Finance investors could get back as little as 12.4c in the dollar, The New Zealand Herald reported today.

The case was to be held in September but the Public Trustee applied to have it brought forward after Octaviar announced a creditors' proposal.

A spokesman for OPI New Zealand said the directors did not support the liquidation proceedings.

"The directors have not yet had sufficient time to consider the offer that Octaviar is making to its creditors.

"OPI Pacific has advised the Public Trustee that it intends to appear at the proceedings and oppose the making of any winding-up orders."

OPI Pacific Finance was forced to default on repayments in late January when Octaviar declined to provide further support, because of its own difficult financial position

I find it strange that OPI in one sentance says it has NOT had enough time to consider the offer that has been made to creditors, but in the next sentence it says it will oppose the QPT "making ..windup orders". Either they want more time to consider or that it is obvious that the OPI is much better off with OCV trading out (not being wound up).

So whats best for the PIF? Jenny & team need to consider this carefully. Is Stella worth much more than CS has quoted? If so, would the PIF be better with a liquidation? Jenny should have the resources to find out and make a totally CS free independant evaluation that is best for we the investors.

SPLITPIN · 23 July 2008

Re: Octaviar MFS Premium Income Fund PIF

All

I must thank Seamisty and DoraNboots (who must be real ladies with names like that) in their excellant research and contributions.

I am not so sure about Great Dame (Mr. McGoo), but I do miss lately his ?? colourfull text.

I trust ASIC / WC and others by are by now hopefully hanging on our every word.

Splitpin

Rance · 24 July 2008

Re: Octaviar MFS Premium Income Fund PIF

SPLITPIN said:
I trust ASIC / WC and others by are by now hopefully hanging on our every word.

Splitpin

I certainly am Splitpin, BUT to what effect I'm not sure!!!

great dame · 24 July 2008

Re: Octaviar MFS Premium Income Fund PIF

zixo said:
Hi Rick,

I see that you have been pushing for the NSX listing for quite a while and I was wondering if there is something you may know that we all dont.

Perhaps you can answer me/us some questions that Wellington have failed to supply me regardless of the amount of times I have requested a response since Ive e-mailed and followed up with phonecalls since the 9th of July

I, like many, cant say that the NSX is bad or good unless we know all the pro's and cons associated with listing it. I mentioned to Jenny at the forum that it remains a very grey area for many investors and she said she would supply information in that respect and the way the NSX question would be asked.

Please share whatever info you have because at this moment. I have no idea which way forward is regarding the NSX and the way the question will be submitted to investors.

Cheers

Zixo I want to know also why WC is hell bent on listing on that DUMB NSX Instead of the ASX If Rick thinks we can sell any units on the NSX You better think again Rick just take a look at there web site NSXA.COM.AU Complet lake of buyers of the 60 odd companys listed there would be buyers for less then half of them And those buyers there bids are next to nothing I can not support Listing on the NSX at all If it has to be listed it must be the ASX YES RICK Please explaine to us all why you want the NSX instwad of the ASX Waiting your reply /////////

great dame · 24 July 2008

Re: Octaviar MFS Premium Income Fund PIF

SPLITPIN said:
All

I must thank Seamisty and DoraNboots (who must be real ladies with names like that) in their excellant research and contributions.

I am not so sure about Great Dame (Mr. McGoo), but I do miss lately his ?? colourfull text.

I trust ASIC / WC and others by are by now hopefully hanging on our every word.

Splitpin

Good morning Splitpin I wish i could could put words to geather like the above but i cant I must add this to my 2 bits worth though Listing on the NSX will be like going back to buying at the corner shop instead of supermarkets I think a lot of the unit holders dont know much about stock exchangers The ASX is the ONLY way to have our units listed Believe me i am right about this /////////

goldfinger38 · 24 July 2008

Re: Octaviar MFS Premium Income Fund PIF

great dame said:
Good morning Splitpin I wish i could could put words to geather like the above but i cant I must add this to my 2 bits worth though Listing on the NSX will be like going back to buying at the corner shop instead of supermarkets I think a lot of the unit holders dont know much about stock exchangers The ASX is the ONLY way to have our units listed Believe me i am right about this /////////

Can we at least wait until we see what information JH supplies about the proposal if any to list on the NSX. which should come out with the voting papers being forwarded mid-August.

Just some general comments,

if I was a buyer whether it be on the NSX or the ASX, why would I pay more for a stock simply because it is listed on the ASX? Wouldnt I be looking at the company financials etc to work out what I am prepared to offer to buy the units, or I am just one of the many investors that may want to buy more units and therefore it wouldnt matter which exchange the units were listed on.

Obviously there is a significant cost difference to list on ASX compared to NSX, I think JH mentioned about half the cost on the NSX.

But either exchange still allows an investor to offer their units for sale, it is up to the brokers to offer the units to their clients and or WC and JH to provide information to current unitholders if they wish to sell or buy units.

Listing on either exchange does not materially change the value for the units, they both can allow purchaser to offer what they want for the units being offered for sale. It is still a free market ( meaning price is determined by b uyers and sellers).

Duped · 24 July 2008

Re: Octaviar MFS Premium Income Fund PIF

seamisty said:
It is my understanding that MFS/OCV received $409million from CVC Asia Pacific for the 65% stake in Stella, BUT, an extra $900million of debt attatched to Stella also went with the deal. So when I went to school (ok ok so it was a while ago!) that equates to $1.39Billion for two thirds, so one third would have to be valued at considerably more than $200+mill, even in a depressed market. So DoraNBoots, maybe that is why the value of Stella has not been factored into the liquidation of OCV valuations. Either no one has a clue what it is worth or the true value is being concealed behind un-audited figures. Regards, Seamisty

Mmmm interesting. I'm going for CONCEALED.

See clause c) of the 18Jul offer to OCVG note holders: "Due to confidentiality clauses in the shareholders' agreement the Octaviar Group is unable to provide current information relating to the Stella Group or commission an independent valuation of the Stella Group"
Hiding behind confidentiality clauses - bodes well for the quality of financial reporting in this country doesn't it. Makes a total mockery of it. This country is a back water.

According to page 15, Stella is actually owned by a company called Global Voyager Holding Pty Ltd (GVH) with CVC owning 65% and OCV owning 35% of GVH.

Para 3.3 b) 'Current Stella Group book value as at 31 May 2008' states "The implied enterprise value on the sale for 100% of the Stella Group was approximately $1.5 billion"

Maybe the $900M debt is with GVH now.
$900M debt + $400M CVC share + $215M OCV share = $1.515B (or "approximately $1.5 billion".

Or maybe the implied value is still $2.4B ($1.5B + $900M debt)

Clause 3.3 "No dividends or distributions will be received in relation to the Stella investment"
That's fine but provides NO insight into the performance of Stella.
Is it accumulating cash/businesses? Is it paying off debt?

Clause 2.2f) "The timing of sale of the [OCV's] 35% interest in the Stella Group is ultimately dependent on CVC"

Duped · 24 July 2008

Re: Octaviar MFS Premium Income Fund PIF

goldfinger38 said:
... if I was a buyer whether it be on the NSX or the ASX, why would I pay more for a stock simply because it is listed on the ASX? Wouldnt I be looking at the company financials etc to work out what I am prepared to offer to buy the units, ...

In an efficient market: yes. But such a thing doesn't exist and NEVER will. Did any of us read through and interrogate all of the PIF PDS, PIF constitution, PIF annual reports, MFS/OCV Ltd annual reports etc? I doubt even the Financial Advisors did. And anyone who thinks they make informed decisions: have you EVER listened to Parliamentary debate (read Hansard), read a Senate Select Committee report, read Senate Estimates Committee reports, read RBA Board minutes etc etc etc?

Fact is, no one has the time. We need trust.

Looking at financials of an invetsment is those going Long. There are others out there. Like Short sellers (selling what you don't have and then buying later, when the price has dropped). It's legal and happens every day. It is in their interest for the price to drop, NOT for the price to go up.

goldfinger38 said:
Obviously there is a significant cost difference to list on ASX compared to NSX, I think JH mentioned about half the cost on the NSX.

At BNE forum she quoted $100K to list and $40K annual costs. Which is a very small cost. Try getting a quality office admin staff for under $40K total cost.

k.smith · 24 July 2008

Re: Octaviar MFS Premium Income Fund PIF

Duped....Thank you for relating this information to us so clearly. Could you also look at a Bloomberg.com article "Octaviar Faces A$1 Billion in Creditor Claim(Update1) June 23,2008, it might also be relevent.

Wellington Capital PIF/Octaviar (MFS) PIF

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