Coca-cola Hbc Share Discussion Threads

[moormoney] 25/11/2010 17:05

back to patiently waiting.

[lionelh] 25/11/2010 09:29

Well done, Soggy, good question, good very helpful reply. 35p per share is more than I thought it would be in all honesty (nearly half of what you paid per share, Soggy) though I thought it must be well into double figures; but why is a company with 35p per share in the bank in the position it is in? It is astonishing. If they were relisted again that locked in value would surely make the sure price shoot North?! Come on! You'd be looking at £1 per share surely! There'd be a stampede! NAV increasing all the time as well of course as the business is cash generative.

I increasingly feel the bank that put CCH in this position was being opportunistic and very probably wanted to exercise a charge over the business so it could taake it over on the cheap and make an enormous profit for itself.
Sharks, the bussness world is full of them.

I feel more optimistic today. If the court allowed the bank to get away with this, it would be condoning each shareholder being ripped off to the extent of 35p per share which inequitable and unfair. The law's for everybody and tries to protect all stakeholders, including you, the shareholders, who own the company. There is nothing wrong with this company. It is thriving, it is profitable. It is not in adminstration and can pay all creditors. What reason would there be to wind it up?!

Be optimistic, though there are no guarantees as I'm sure your aware. My opinion only again.

[moormoney] 24/11/2010 22:07

Thanks for sharing soggy-I'm pleased also to have some hope restored. I believe they did try to repay the bank loan but there are prosecutions in Dubai over something to do with a cch employee. I remember finding some details on google but all very vague. NAV of 35p is encouraging and if the co has to remain below the radar a while longer so be it. I hope Mr Fossett will continue to communicate with us.
Scrutable held a sizeable chunk of these shares I believe so if anyone sees him posting on other threads direct him this way--he might be able to find out more.

[soggy] 24/11/2010 19:38

...well, that was a short wait!

I've had a very helpful and kindly reply to my email to Mr. Fossett. Given the imprecise nature of a NAV per share with all the fluctuations possible, and given that any value is academic until the legal situation is sorted, he has informed me that the company's shares should be worth a NAV in the region of 35 pence.

Comments are invited... I'll start off: given what has happened, I'm slightly relieved to hear that! I had written off my total investment, but PERHAPS, with time, I might actually get some of it back. Hmmmm....

[soggy] 24/11/2010 19:05

Yes, you are saying more or less what I said at the time the debacle came to light. I could not believe at the time that (a) "the bank" had the right to put the co. out of business, and (b) I couldn't beleive that any bank would be so stupid as to kill off the only real chance they had of getting their money back.

In very short order, however, because of the banking crisis/credit crunch and all the jitters around, they astonishingly did pull the plug - or attempt to. I'm not a businessman, but I simply couldn't understand why, for the sake of calling in a relatively small amount for a bank because of what was in effect (as reported I hasten to add) a relatively small breach of the terms, they called it in.

At the time I concluded that there must have been more behind it than that. But in those paincky times, I guess it was a case of "get whatever money you can back in the coffers and to hell with any future profitable returns on it."

But as I say, I'm not a businessman, and I guess most of us will never know the full truth of what happened, unless it goes to court and we can be bothered to study every court document and have the savvy to understand it....

In the meantime, we all sit and wait...

[lionelh] 24/11/2010 15:22

Know what you mean, Soggy, the details are painful and all too easy to forget.

Now, legally and technically DIB might well be in the right, but given that CCH is profitable and continues to be so could you not argue that their action in trying to pull the rug completely is not proportionate to the breach that in fact occurred. In terms of the law of contract a minor breach entitles the other party to the agreement to damages, not to repudiate the contract completely. I think they are trying it on and hope very much a court would see it like that. What have DIB actually lost? Looks suspiciously like nothing to me. Again the sort of question the law would ask.

Again, don't wish to give false hope, that's just the way I see it.

[soggy] 24/11/2010 13:49

Thanks for that helpful clarification....it was a long time ago and I think I've just been wiping the painful details from my mind!

Cheers.

[lionelh] 22/11/2010 12:31

Don't claim to be an expert again, Soggy, and haven't followed every twist and turn of this protracted saga, but it is not my understanding at all that it is just one deal that has led to the dispute in this case. Though they have comtinued to trade, I believe what happened has affected every single deal the company is involved in. Put very simply, CCH did not have money to finance their business model, so, as is commercially usual, they went to a finance provider, I'm taking it as Dubai Investment Bank (DIB) in this case. Again as I understand it, CCH lent monies to clients medium to long term instead of short term as provided for in their banking agreement, a position protected by a banking covenant which is again a usual position as it is legally enforceable in the law of contract. That breach of a banking covenant and contractual dispute have led to DIB taking the action they have. The credit squeeze led to a large number of banking institutions completely reassessing the risk entailed in their lending practices and particular clients. Many got twitchy, DIB included.

[soggy] 20/11/2010 07:20

Thanks for the comments chaps.

Lionel, the reason I put the caveat in about value being imprecise was because they have been trading, and the value might be significantly different from the figures in those account. Also, as you point out, any statement of value could then be hedged by pointing out the potential liabilities in the event of the legal wrangle coming to a head.

At the time of the debacle I think I posted the point that this one deal which was in dispute wasn't the whole of the company's business, and that in theory we still had all the other deals which we had done and which were ongoing and which should have been bringing in revenue. What I never understood was the relationship between the two parts of the business - the UK and Gmbh sides. Again, from memory, I seem to recall that the bit that was left trading was the rump and the bit that went "out of business" or was in dispute and was liable for the massive loan repayments was the bit that had all the money. If my memory is correct, then what is left will never be brining in the kind of money we all invested for.

But it's a long time ago now, I cannot remember all the details, and I have written this off, so, if some day it starts trading, or we get bought out, or there is a distribution of the assets, I'll consider it a little bonus. But I'm not holding my breath!

Good to know I'm not the only one who still has this thread on their radar... Anyone else want to say hi!? Come on, who else is reading this?!

[moormoney] 19/11/2010 23:14

I don't think the uk side did stop trading it just dropped out of sight so to speak after the majority of it was sold/transferred to Eren N for $1 if my memory is correct. At the time this was to protect it from the Dubai mess and now it is appearing very succesful. Nobody knew what was going on or understood the reasons but I feel much better waiting for my frozen pot to warm up again!!

[moormoney] 18/11/2010 21:27

good one soggy!

[soggy] 18/11/2010 09:12

On a lighter note...if you put the postcode for the company secretary into google maps, it shows it as a restaurant, between a church and a bank! Now there's our whole situation summed up in one street - some have dined out on this co. but we're stuck between prayer and the mercy of the banks!

[moormoney] 18/11/2010 00:24

many thanks for your interesting postings. I too bought in because the co was growing like topsy and looked very strong. I'm pleased Erin kept his word and handed back his holding this seems very encouraging. After the dubai bank went after them he bought this holding for 1$ I think to protect the assets and act as custodian. It has been so long with all sorts of legal actions going on in dubai I'd just about given up so I admire Eren for keeping his word. maybe just maybe we will eventually refloat! Scrutable had a very large holding here so I hope he is able to find out more for us.cheers all.

[soggy] 17/11/2010 21:37

Thanks for that further comment, Lionel. Appreciated. I may well send such an email. Sadly, I bought right at the top - 85p. I guess someone has to!

I've had a few disasters over the years - lost my whole stake in some dotcoms that went bust, but it always amazes me that sometimes, even years later, some money trickles out: Railtrack, Ionica, to name two. Maybe someday we'll get some value back from this!

[soggy] 13/11/2010 16:32

Has anyone else received this document? And has anyone who's smarter than me (not hard) had a look at it to see what the numbers are really saying?

[moormoney] 13/11/2010 14:22

Thanks Soggy at least we know something is going on behind the scenes!

[soggy] 12/11/2010 12:52

Bottom line, Erin has kindly donated his shares back to us free of charge, so the company now has 20,492,513 shares - 35.45% in our hands, but the rest still owned by Emir Nil.

The company as managed to realise $6.5m on the sale of assets and their lawyers are now advising them that the agreement which got us into this mess might not be enforceable - but negotiations continue with the bank which says they still owe $40m. [EDIT-"they" as in "we", CCH still owe the bank $40m,]

I wouldn't hold my breath - but at least with a sizeable chunk of the company handed over to us, (the least he could do after getting us into this mess) if there is a payout we'll get an extra farthing each....don't spend it all in one shop now.....

[soggy] 12/11/2010 12:46

I got the annual report and accounts through today. The notes at the end of it give a reasonable summary of what's happened. If anyone is interested and didn't get the report, here's what it said:

OIAX LIMITED
(FORMERLY CCH INTERNATIONAL PLC)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2009
18 Contingent liabilities
On 16 August 2007, trading in the Company's shares on AIM were suspended following an announcement that the Company was in discussions regarding certain of its funding lines. These discussions were necessitated as a result of one of the Company's principal funding banks (the "Bank") indicating that it intended to terminate agreements with the Company and CCH Europe GmbH ("GmbH") following a review by the Bank which revealed that approximately US$340 million of lending advanced through GmbH had not been applied to short term receivables but to longer term commitments. The Bank demanded immediate repayment of all funds (amounting to approximately US$500 million) advanced under those agreements by the Bank on its own behalf and on behalf of a second bank for which it was acting as agent. In view of the threat of disruption and uncertainty caused to the Group's business by these developments, the Board decided to request suspension of trading in its shares and entered into negotiations with the Bank.
On 19 August 2007 the Company and GmbH concluded a restructuring agreement with the Bank (the "Agreement"). Under the Agreement, the Company acknowledged that, save in the event of a default situation under the Agreement, the sum of US$50 million was due and payable by the Company to the Bank as a primary obligation in respect of the advances made by the Bank to the Company. The Company also guaranteed the repayment of a total amount up to a maximum of US$100 million (including the US$50 million primary obligation) (the "Guarantee"). The amount of the Guarantee was to be reduced by any amounts paid to the Bank by the Company and/or GmbH from the proceeds of the receivables.
On 7 November 2007 the Company discharged its primary obligation to the Bank in full. The Company, however, understood at that time that it remained liable under the Agreement for the amount guaranteed less amounts repaid by the Company and/or by or on behalf of GmbH. Accordingly the Bank notified the Company that it believed that the Company's liability under the guarantee has crystallised. If successfully called, the amount of the Company's remaining guarantee would be approximately US$40 million-Following the entering into of the Agreement, the Board considered a number of alternative strategies and concluded that shareholders' interests would best be served by seeking to conserve the Company's funds and if possible to make a distribution to shareholders as soon as possible. To this end the Company sought to negotiate a release from the Agreement from the Bank so that the Company would not have any liability under that agreement (contingent or otherwise) thus enabling a distribution to ordinary shareholders to be made. The Company initially sought to persuade the Bank of the merits of such a release on the basis of a number ofreasons including the fact that the Company had repaid its primary obligation of US$50 million to the Bank, and it was in all parties' interests to ensure that independent minority shareholders' interests were considered.
In June 2008, the Bank publicly announced that it had seized various real estate assets in the UAE that were provided as collateral under the Agreement, and in October 2008, the Bank stated that it expected to recover the full amount of the loan in question from the seizure of those assets.
The Board was encouraged by this development, particularly given the apparent public confirmation by the Bank that the real estate assets were sufficient to cover the Bank's exposure. The Board has continued to negotiate with the Bank in an effort to reach an agreement between the parties and secure a release for the Company. Regrettably those negotiations have so far been unsuccessful.
More recently the Board has become aware of facts and matters pertaining to the circumstances surrounding the negotiation and signature of the Agreement (which contains the Guarantee). The Board has taken the advice of counsel which indicates that the Company may have good defences to any claim by the Bank under the Guarantee and that the Agreement may be unenforceable by the Bank against the Company. The ability of the Bank to enforce the Agreement and Guarantee against the Company will depend on an investigation of the full facts. Such investigations are continuing, as are discussions with the Bank.

[moormoney] 13/7/2010 23:22

So am I but if they are in trouble still in dubai--it is likely to be long wait! There doesn't seem to be any way of finding out what is going on-- We can't even write off our losses I presume.