Establishment Investment Share Discussion Threads

[greek islander] 09/6/2009 09:11

ETC suddenly looking very cheap.
The results were much as I expected and indeed the fall back in the share price is probably PIs panicking out.
With a Kuoni director to be on the board and with obviously plenty of cash available to the CEO, I suspect that ETC will concentrate more on turnover and acquisitions than on margins. This is a shame as improved cashflow and margins would generate a lot of confidence with shareholders like me. Also I find the amount of detail re the financials remains very ungenerous and one senses the Board continue to not take any great responsibility to keep shareholders informed of the minutiae that helps us form an opinion of the state of play.
They are floated on AIM in UK and as UK dominates the PI shareholding, They should respect us more with clearer and more regular TUs. It is a bit like getting blood out of a stone. If they want us to be loyal and eventually maybe to cough up more cash, then they had better learn to value us.

[greek islander] 04/6/2009 09:27

Yes don't know why we bother with UK Analyst sometime - except it's free!

[longshanks] 04/6/2009 08:41

irony is that "UK analyst" is probably just some sap in Bangalore typing out whatever they are paid to by Seymour Pierce. It is in SP's interest for there to be a bit of mystique around the price paid....clearly they take the rest of us for idiots.

[explorer88] 04/6/2009 08:33

Morning GI

"Information about the price paid for the holding has not been released" - UK Analyst.

UK Analyst needs to do a bit more analysis ... the price paid was £5.3m (source: Kuoni press release) or 50.4p per share (ETC RNS mentions number of shares sold to Kuoni)

[greek islander] 04/6/2009 08:09

UK-Analyst today:

"China-based travel group ET-China's (ETC) shares soared by 15p to 50.5p after it announced that Kuoni Travel Holding limited has acquired a 31.8% stake in the group. ET-China said the purchase of 10.5 million shares would help it benefit from the group's expertise in the sector and improve the efficiency of its own operations. Information about the price paid for the holding has not been released. Kuoni will be able to nominate a directors to the firm's board provided it holds at least 25% of its share capital. Broker Seymour Pierce said the purchase of the stake was a validation of the firm's performance. It added: "The acquisition of such a large stake might be considered to imply that Kuoni should make a full bid for the company. However, the board has sought special dispensation such that this will not be the case at this time. Moreover Et-china is not a 'code' company. Kuoni will take a place on the board and will henceforth be the largest shareholder in Et-china." The broker said that it expects to upgrade its earnings forecasts for the firm and maintained its 'buy' rating for the shares. "

[explorer88] 03/6/2009 23:44

GI - yes, i think it's great news for Kuoni, ETC and ETC's shareholders.

[greek islander] 03/6/2009 23:42

explorer

Twelve months ago they would have had to pay three times that to buy such a big stake.
Good bit of business for them, as ETC is now a substantially bigger company.

[explorer88] 03/6/2009 23:20

Kuoni purchased their stake in ETC at 50.4p per share

[longshanks] 03/6/2009 19:25

Press release from the Kuoni website indicates a little more hope for a co-operative rather than exploitative partnership.

Summarised by:

"In acquiring its holding in Et-china, Kuoni is embarking on a key long-term strategic partnership with one of China's most important travel corporations," says Peter Rothwell, CEO of the Kuoni Group. "This expansion of our activities in China is one of the biggest milestones to date in the more than 100 years of Kuoni's company history."

Full press release here:

[roughandtumbleone] 03/6/2009 13:56

Thanks Explorer.

Regards,

R&T

[explorer88] 03/6/2009 13:39

Hi R&T : The company is incorporated in Jersey. The rights of shareholders therefore vary from those of a UK incorporated company. afaik, Kuoni is not required to make a bid for the whole of ETC (note proposed amendment to Article 171.1).

[greek islander] 03/6/2009 12:44

That old soldier JT Cod has come with a frightening scenario in response to my discussing ETC on his blog.

I think it is a bit of a doom and gloom picture but worth noting - he is a clever guy to even think of it. I refer to his posting today -

JTCod - 3 Jun'09 - 10:43 - 22858 of 22860


GI
I'm playing DA here but now that Kuoni are a controlling shareholder they could use ETC as a booking agency for their wider transport plans across PRC and at prices that run the company as a loss making concern whilst Kuoni pick up the profit. Probably will not be the case but I am just pointing out that nothing is a given in these situations. What concerns a large company like Kuoni when they buy a controlling share in a small business is that the large company make the money. That doesn't always equate to a profit for the smaller company.

It's an old Murdoch trick btw (source book 'Virtual Murdoch'). I'm just pointing out that these sort of deals don't always end in profit for the small guy if the big guy should turn out to be unscrupulous. Look at what happened when Zed (a well regarded Telecomms company from Spain) took a controlling share in the loss making Monster Mob. They made sure the company never recovered and then took them off the market. You cannot make assumptions where these deals are concerned imo.

[roughandtumbleone] 03/6/2009 12:25

Explorer/ anyone,

Can you just clarify a point that themoneymonster asked earlier...

Kuoni have acquired 31.8% from the hedge fund - I was under the impression that any company owning more than 30% had to make a bid for the company.

Can someone clarify this for me?

Thanks in advance,

R&T

[themoneymonster2] 03/6/2009 11:51

Should pick up later again. Will be interesting to hear what James Faulkner thinks in his comments later on watshot.com!

[greek islander] 03/6/2009 11:30

Some selling going on -
looks as if we might have waited for some profit taking. I had thought that the momentum was set for the day and that 58p was a good price.
This often happens with a surge in share price - it draws out those who have been sitting on stock for a while looking for an out!

[explorer88] 03/6/2009 10:42

o/t arty - no further snippets atm

[themoneymonster2] 03/6/2009 10:34

Don't they have to make a bid if they hold above 30%?

[arty] 03/6/2009 09:45

EXPLORER - any further snippets on BXTN ?
o/t apologies.

[jonny flame] 03/6/2009 09:18

Nice one...nicely in profit now

[gujibiglips] 03/6/2009 09:16

foookin classic - al ur book :)

[greek islander] 03/6/2009 09:15

Managed to spend just over £2k in two lots. Barclays for once these days did me proud. I am happy with 58p compared with the 122p I got when I sold last time. The prospects are enhanced in the interim. Will buy more if the share price stays sensible.
Thanks money monster: a few days makes a lot of difference and I hope that my reservations are proved flawed.
Having Kuoni on board, means the company will be carefully policed, no doubt and therefore I am now happy to give it my full backing,
The potential is obvious for all to see - let us hope that the results are really imminent and not like last year delayed and delayed. We are told that the recent acquisition is now creating good revenue and that may begin to impact on the figures, probably for the next years results.

[roughandtumbleone] 03/6/2009 09:02

Explorer88,

I stand corrected! Well done here!

Best wishes,

R&T

[themoneymonster2] 03/6/2009 09:00

GI, i can see a few more days with a decent rise! All the best!

[greek islander] 03/6/2009 08:56

Sold out at 122p so this price is an attractive one.

[themoneymonster2] 03/6/2009 08:49

Looking good chaps! Not many shares available by the looks of things. I think around 70% are owned by directors, institutions etc so any buy ticks the price up! Chart is looking good for 80p!