Kenmore Euro Share Discussion Threads

[crawford] 09/3/2010 11:29

Sky, I'm not currently invested here, I was a bit wary of the last financial statement:

"Financing
As at 30 September 2009, the Fund had debt levels representing gearing, on total
property value (after applying disposal proceeds set aside for scheduled debt
repayment), of 67.4%. If all cash balances within the Fund were to be applied
to reduce the drawn debt facilities it would reduce gearing to 61.6% leaving the
Fund with 11% headroom on average LTV. The Board continues to monitor this
whilst entering into discussions with its lenders to secure longer term
financing solutions. Furthermore, the Company had interest rate swaps in place
for 106% of its drawn debt, at a weighted average rate of 4.19% for a weighted
average period of 1.9 years.

[skyship] 09/3/2010 11:16

It was way back on 25th November when Hansteen announced they had bought a 12% stake in KEIF in an off-market transaction valuing KEIF @ c.40p/share. They entered into due diligence talks with KEIF at a time when the waters were muddied by the bankruptcy of the property managers Kenmore Investments.

Up until then KEIF were ticking all the right boxes, especially with the active management of their property portfolio - hardly a month passing by without a further sale at above valuation and a further reduction in the LTV.

Since November - a big silence and a slow but steady drift back in the share price

So, my reading is that:

If there is a bid from Hansteen, it will have to be at more than 40p & in CASH.

If there isn't a bid from Hansteen - so what? Someone else might be in the wings; but KEIF were doing very well on their own.

Either way, at 36.0p-36.5p they seem like value again, so I've made a small introductory purchase at a tad under 36.5p.

Incidentally, can someone elucidate on the subject of deferred tax - as per the 19th Nov'09 IMS - see link below. If you add back the deferred tax the NAV leaps from 53.5p to 75p, but is that extra 21.5p real? Someone recently gave a very good explanation (perhaps on TMF - perhaps here on CP+) but I've forgotten the basic tenets of it all!!!

[ydderf] 07/2/2010 10:29

the bid has been bad news for holders up to now......?

[flying pig] 18/1/2010 13:39

Must be time for news.

[cmpf] 02/12/2009 19:25

All gone quiet here. Any thoughts as to where we might be going. Little movement since the Hansteen announcement.
Or do we now just have to sit and wait?

[crawford] 26/11/2009 08:41

nick,
I agree; looking at the RNS today, it appears that Brockland could be involved in managing KEIF's assets in the future - perhaps this stake might act as a deterrent to a takeover on the cheap?

This_is_me,
I would expect at least within 15% of NAV.

[this_is_me] 26/11/2009 08:11

The publicity seems to have kick started a rerating. Surely a takeout price has to be around NAV.

[nickcduk] 26/11/2009 06:30

Some big buyers joining the party. Brockland inc turned up on the shareholder list with a purchase of 7% of the company at 40.5p. About to get interesting I think. IERE and MERE now seem interesting plays.

[crawford] 25/11/2009 17:21

cmpf,
we have a say by not voting for it, management should not be even accomodating this approach. If that happens, then we will do a RUGB - they are in similar circumstances and the bid has been dropped.

I'm hoping for similar here. It's good to have the spotlight on the company - this approach shows how uncorrelated the share price is to assets.

[cmpf] 25/11/2009 16:50

Without wanting to take the gloss off a good day. Presumably as small PIs we don't get a lot of say in what actually occurs.
Is it worth trying to assess what we as PI have jointly between us?

[kramch] 25/11/2009 16:06

From the interim statement to 30 Sept 09, issued 19th Nov, Net Asset Value is 79.2p (adjusted to add back deferred tax, which as I understand isn't ever payable unless you take the properties our of their incorporated boxes). So no way should the management be considering selling out at this price.

It's a reminder of the value that's locked away in this fund. K

[crawford] 25/11/2009 10:49

flying pig,
yes, about 50% below NAV, no way I'll be voting that in.

[flying pig] 25/11/2009 09:58

Indicatrive price does not look very generous - I might prefer to stay with the existing party.

[crawford] 25/11/2009 08:34

Hansteen confirms that an approach has been made to the Board of KEIF in
relation to a potential offer by Hansteen for the remaining issued and to be
issued ordinary share capital of KEIF. The potential offer comprises 20p in cash
and 0.2469 new Hansteen shares for each KEIF share, which equates to a value of
approximately 40.6p per KEIF share and values the issued share capital of KEIF
at approximately GBP56.8 million, based on the Hansteen share price of 83.25p as
at the close of business on 24 November.


Hansteen believes that this potential acquisition is an excellent opportunity to
buy high yielding assets which would complement and extend its existing European
portfolio. It would also further capitalise on the asset management expertise
already developed by Hansteen in Europe. Furthermore, Hansteen believes that an
offer at the level indicated would be in the interests of KEIF shareholders.

[skyship] 25/11/2009 08:29

I'm out too!! Hopefully Ken still in. WEhat did you make of the MCKS statement this morning?

[alanji] 25/11/2009 08:15

Had to happen - I sold mine last week!!!

[skyship] 25/11/2009 07:38

Possible Offer from Hansteen:

[cmpf] 22/11/2009 20:53

freddy you are missing one thing though, which is, hopefully as the commercial property sector continues to recover then the underlying value of the assets will increase. This may not keep pace with the exchange rate risk in the short-term, however I would like to think, imho, that from this low point the only direction the value of the properties will head is upwards, whilst the exchange rate may remain more volatile.
My conclusion would be that over the course of the year on a day to day basis we may see the NAV discount shrink, but in 12 months time we could be where we are. Similarly it would be good to see the NAV discount gradually start to disappear as a result of the share price increasing.
I agree with the flying porker in 3 to 4 years these could turn out to be a great investment. The share price could easily have doubled or tripled or maybe better and we could be getting a handy little divi.
Accepting, of course, that it could all go entirely pear shaped .... but I like to think that I am a glass half full person.
All imo.

[ydderf] 20/11/2009 10:31

Trouble is, if the GBP recovers to just ppp, say 1.25 Euros, there will be a massive dent in the discount to NAV. If this doesn't happen then the current discount is probably no more than fair. The statement about the Kenmore administrators is still not fireproof either.....

[flying pig] 19/11/2009 20:26

The net asset value has increased, but this is mainly due to currency factors. There has been a small reduction in the portfolio valuation.However, the yield remains very attractive, and the discount is good.

The discount is (in my view) too high, so this is an opportunity to buy for long-term yields. A tuck-away in a pension fund or an ISA where I have little doubt in 3 or 4 years the investment will seem to have been incredibly good.

Where else can you get a high yield with reasonable security? All suggestions gratefully received.

[crawford] 19/11/2009 16:09

NAV has increased here!

Portfolio decline only 1.59%

[nickcduk] 19/11/2009 09:31

We are due an NAV and trading update later on today. Timing can be erratic though. Previously they have been released around mid-day but on other occasions after market close. Hoping that it will trigger a bit of a re-rating. Trading on a much larger discount to peers.

[cmpf] 19/11/2009 08:51

Nice tick up in the share price yesterday. Hopefully the initial panic over the collapse of Kenmore is now behind us.
Would be nice to see another tick up today.

[lbo] 18/11/2009 20:48

Firms could lose millions following collapse of Kenmore