Bb Holdings Share Discussion Threads

[skanjete2] 27/5/2009 10:56

Dr. Euric Bobb receives 250.000 options with exercice price of 6,5US$/sh.

Unless they want him to look ridiculous, they think the shares have to be worth something like 6,5US$, or at least have the potential to surpass it.

[skanjete2] 20/5/2009 16:17

Given the circumstances of last year, the results are brilliant, certainly in view of the current share price. At these prices, you're paying for Numar and the rest is for free.

These results are not to be compared to results from western banks, only maybe to results from other banks in the Caribbean as Bank of Butterfield (Bermuda).

For the rest I think I can keep my estimations from may 7 :

"Using their ROE ratio's to estimate possible earnings brings us more or less the same result.
They've got approximately an ROE of 24%. The return on total assets for their banking operations is one of the highest I ever encountered : more than 4%!

This could put the equity value per 31/3 at approx. 350m US$ on profit of approx. 62mUS$ for 2008

Add the 50m US$ from the merger, and they're working with an equity value of 400m US$.

ROE 24% means a profit of 96m us$. So this means a profit per share of approx. 100c/sh, or 66p non diluted. The warrants & options included would bring us to 83c/sh or 55p/sh.

Since circumstances are very favourable for banking at the moment, this could well be a conservative estimation."

[woracle] 20/5/2009 15:38

106c is 62p on average xrates. Historical PE of 1.9 and NAV of 250p/share if you include recent merger. Less than half book value. Bad loans .. par for the course for any bank but 16.7M for 2009 is about 25% of profits, 5.5M written off this Q4. Hardly BofA or RBS levels but something to watch.

[woracle] 18/5/2009 08:11

Results imminent..may wake up a few lemming tip sheets i reckon ;)

[skanjete2] 07/5/2009 16:16

Woracle,

Using their ROE ratio's to estimate possible earnings brings us more or less the same result.
They've got approximately an ROE of 24%. The return on total assets for their banking operations is one of the highest I ever encountered : more than 4%!

This could put the equity value per 31/3 at approx. 350m US$ on profit of approx. 62mUS$ for 2008

Add the 50m US$ from the merger, and they're working with an equity value of 400m US$.

ROE 24% means a profit of 96m us$. So this means a profit per share of approx. 100c/sh, or 66p non diluted. The warrants & options included would bring us to 83c/sh or 55p/sh.

Since circumstances are very favourable for banking at the moment, this could well be a conservative estimation.

[woracle] 07/5/2009 08:19

skanjete, he has a history of selling I think. But Belize is his home ground and hes getting on a bit. Depends how he wants to pass on his wealth I guess.. Yes there are options and warrants but they are at much higher prices and the cash brought would will add materially to the NAV. Its not just a EPS play, its an asset play too. They dont have bad loan problems as we can see and they have Numar too. Even adding 25% dilution is hardly stretching the PE. Lets say eanings grow 10% to 77m this coming year at 100m shares and $ xrate 1.5, thats still EPS 51p. Even if we take into account dilution, it would be 41p diluted which is still less than 3 !

[skanjete2] 07/5/2009 07:40

Woracle,

What do you mean by 'cash in his chips'? Selling?
Isn't there a possibility that Ashcroft wants to stay and f.e. take BB Holdings private?
I hope he doesn't and honestly I don't think he will because that would make the recent second listing in Bermuda nonsense.

Considering the earnings per share, I think we better take into account the 18,8 million warrants and 7m options. Officially they are not dilutive since the market price is lower than 6,5US$/sh, but considering the true value of the company, I consider them to be dilutive.
Go try and buy 18,8+7 = 25,7 million shares for a price less than 6,5US$. It won't that easy I think.

[woracle] 07/5/2009 00:32

Merger completes today. Results soon probably 109c leaving historical PE of less than 2. Not sure when Ashcroft is gonna cash in his chips but he will. Numar will be roaring again with CPO back around $800.

[skanjete2] 08/4/2009 16:25

It doesn't make sense.
Why would lord Ashcroft be buying BBHL if instead he could have been buying CKL?

On the face of it, the deal isn't fair.
But :
- Lord Ashcroft would be screwing himself if he agreed to the deal if one takes into account his warrants and options.
- why would the other directors agree with the deal then? Gaze would seem to be a little better off, but Johnson & Osborne would lose a lot since they have a much greater interest in BBHL than in CKL
- Hammond, Cheryl Jones & especially John Searle have a major interest in BBHL, but no apparent interest in CKL. So they would be diluting themselves with agreeing the deal.
- Lyndon Giuseppi (CEO) has been awarded 2.000.000 options at 6,5US$/sh. I don't think they wanted him to look ridiculous, so I suppose they considered the shares worth something like 6,5US$/sh (and keeping their worth). These options would be a lot less worth if the deal really is that diluting. So why would Giuseppi agree with the deal?
- All major shareholders and directors have a major interest in shares, warrants or options convertible at 6,5US$. Since the conversion price didn't change, it seems unlikely to me that they would agree with such a major dilution, since they would lower the value of their options and warrants.

There are about 18,8m warrants and 7m options. So this is a possible dilution of 25,8m shares, or 43,8% in relation to the original number of shares. If one considers the worth of a share higher than 6,5US$/sh, the total number of shares to be taken into account would be m84,6 instead of 58,8m.

The new dilution is a lot less in this situation of course.
The math doesn't prove that the deal is completely fair, but the interests of all parties involved suggest the deal to be fair.

I agree although that the deal and the other actions of the past few months seem to be structured in such a way that they seem as unattractive as possible to minority shareholders.

[woracle] 08/4/2009 13:30

Then buy shares in CKL..surely cheaper way to play it if you believe he will realise the value in the end.

[skanjete2] 06/4/2009 19:48

It seems I was a bit too harsh in my conclusion.

If one considers the outstanding warrants and options of BB Holdings, the deals seems to be more or less fair for the shareholders.
It depends what return they can realise on the new funds, but in a certain scenario, the deal seems fair (although no homerun) for the BB holdings shareholders.

[skanjete2] 06/4/2009 10:15

After some second thoughts : another possibility would be of course that they can find some very value enhancing opportunities for the acquired cash - on short order.

In the rationale for the acquisition they also allude to the possibility of new investements and/or acquisitions. Maybe something in Trinidad & Tobago? Their new independent director - dr. Euric Bobb seems to be some kind of expert of T&T, and as an independent director, he seems to be supportive of the deal.



The independent directors, as well as Philip Johnson (=CEO CKL & BBHL) f.e. don't seem to be really major beneficiaries from the merger. They all have a greater interest in BBHL than in CKL.


So this would be a possibility. But then I wonder why they wouldn't announce everything (merger+new investment) at once.

[woracle] 25/2/2009 13:06

OK, so back to lows again. Suppose all the moneyweek and undervalued-shares.com lemmings have gone, and Ashcroft is picking everything up again ;)

[woracle] 23/2/2009 17:18

He is a bit of a shadowing figure though.. Hope hes no Stanford !

[nickcduk] 06/1/2009 08:54

Agreed that Ashcroft is here to make money but he has a history of delivering value for all shareholders. He could have taken OSS private when no one was interested in the company. Instead he left it on the markets and then delivered a 600%+ premium for shareholders. Tidying up the shareholder base will save BBHL money so the 2 are linked.

[tiredandweary] 06/1/2009 08:47

You are mistaken methinks
Ashcroft has never been interested in being tidy
only making money
with dollar earnings and a low share price
we shall see
watch this space

[nickcduk] 05/1/2009 13:52

Not sure its a pre-cursor to a bid. Its just tidying up the shareholder base from pre Carlisle days. Can be a pain having to service shareholders with small holdings. Dollar strength is providing a windfall for BBHL at present. Hopefully they will re-repatriate some of the funds in the near future.

[tiredandweary] 05/1/2009 13:36

this latest announcemnet has to be a pre-curser to ashcroft taking the group private
what other reason would he have for forcing shareholders to sell at the current low price?

[nickcduk] 11/11/2008 13:50

In the meantime its nice having a dollar denominated balance sheet and earnings. I don't think Ashcroft will look to take over BBHL. More likely he will look to sell it on as he did with one source last year. I think the time frame for it is a while off though due to banking problems globally. Could even end up being the hunter due to solid balance sheet.

[woracle] 11/11/2008 13:40

Ashcroft is no fool and in no hurry. He can easily just keep soaking up all sells during this bear market probably all the way down to 150, and just when things start to recover, he can offer 30% premium and take the last 20% he don't own at todays prices ! Thats what I fear will happen..

[tiredandweary] 10/11/2008 08:34

Ashcroft keeps buying shares in big quantities
I wouldn't be surprised if he makes an offer to take it private
give it's low rating and high profits
he'd have to offer a premium to current share price though