Belhaven Grp. Share Discussion Threads

[bigbertie] 23/8/2005 16:25

Quite a lot of people must believe (or hope) that a higher bid is possible, otherwise they would sell now in the market (625p now is better than 625p in a few months time). I think the bid is low - the Scottish pub market probably has a lot more scope for an enterprising smaller player than the English market, and BHG has shown it can exploit this. If GNK make their projected £5m savings it would give an effective earnings per share for BHG of about 55p by my (very shaky) calculations. That puts the cash offer on a multiple of 11.3 times BHG's contribution to GNK which is much better than GNK's present ratio. I'm not surprised GNK are forecasting that the deal will be earnings enhancing in its first full year, but I don't understand why the BHG diretors are so keen to make this a done deal.

[grebo] 23/8/2005 11:08

Hard to say. The fact that we're struggling to find more potential targets to move our money to may improve the chances of a bidding war for this one. Until I can find another likely target I'll be leaving my money here just in case.

[domtheone] 23/8/2005 11:06

Is the general concensus that the fact that the share price is already up to (and a fraction beyond) the offer price, indicative that a counter offer is a realistic possibility..

What chance, maybe 1 in 5...

[bigbertie] 22/8/2005 16:29

grebo - yes, we are running out of good targets in the pub/brewing sector. Most of the remaining ones seem to have strong family control and not very liquid shares. I shall do some research......
By the way I was up in the Highlands last week drinking Dark Island - now there's a beer!

[grebo] 22/8/2005 13:07

BB I think I agree with you. Looked around for other brewers that look like a good place for the money I've currently got in BHG - but I couldn't find any that would look anywhere near as attractive to a bidder as BHG. So I'll be sticking around hoping for a counter bid.

[bigbertie] 22/8/2005 13:03

I'm disappointed too - this looks like an opportunist bid to get BHG cheap while W&D are busy! I quote the offer document "...BHG...has applied a clear strategy which has resulted in strong growth in profitability and enhanced returns for shareholders. BHG's primary objective remains to generate shareholder value whilst growing it's position....." Er, so why are the directors so keen to sell out?

I note that GK expect the BHG acquisition to be earnings enhancing in the first full year, (ie the year to 1 May 2007) so they can't be very worried about the smoking ban!

GK probably threatened to walk away if their bid was not agreed, but so what? The directors could have announced a bid approach, and that might have started an auction. Anyway GK would not have wanted to quit the field completely - it could have gifted BHG to W&D. The company would have remained a successful company and a likely bid target.

Just my thoughts, and I shall certainly not sell out yet.....this could just be the start.

[edmundshaw] 22/8/2005 12:23

Many of the acceptances by the institutions are unless there is a 5%+ better offer. So if W&D wants a go, they'll need to stump up at least 665p I think (given the £2m cost BHG would bear due to the 'incentive' clause).

Not impossible, but the current offer is pretty certain as a minimum; the market is pricing it so, at least.

[pafenna] 22/8/2005 11:00

I am surprised at the speed of this following so soon as it does on the heels of the W&D acqisition of Jennings. Then again, there has been speculation in the press which has driven the price up and this momentum may have prompted GKN to move.

Sounds like this is a done deal although would have hoped for more but shouldnt be greedy really!

So where next for those wishing to hold brewery stocks? Incidentally, PaulF99, HHansons continues to brew as well as owning/managing pubs although IMO I understand this is a close company.

[grebo] 22/8/2005 10:57

Thanks huttonr, have added HDYS to my watch list. Not diving in yet as prior to today's announcement I would almost certainly have chosed BHG over HDYS as BHG seem to generate better profits. Will consider buying HDYS on any weakness though.

[edmundshaw] 22/8/2005 10:16

Paul, yes, 28% is offputting, but still leaves 72%; and the directors would probably need to be given a substantially better offer, as there are probably penalty clauses for revocation. Hard to believe it's a stitch-up, but I just feel BHG could/should have extracted a higher price. The Jennings price was better IMO.

The RNS is full of apologia 'given the uncertainties of the smoking ban', 'the
Offer represents a significant multiple of the Belhaven Group's historic EBITDA' etc etc...

I also wish the offer allowed for taking up GNK shares. These damned loan notes 75 points below LIBOR are a pain...

Still, with Burtonwood, Jennings and BHG representing about 15% of my portfolio 9 months back, perhaps I should be pleased.

[paulf99] 22/8/2005 10:05

Edmund - this is fair value on the basis of your previous assessment (25p out in 625 is about as close as anyone could hope to get). Given the amount of undertakings they have lined up from shareholders (28% according to the RNS) I would guess this would frighten off any competing bid from Wolves. Presumably that's what it's been designed to do. I don't see Hardys as being in the same league - didn't they sell off their brewery? So they're just a pub management company. Question in my mind is whether it's worth buying more of GNK?

[huttonr] 22/8/2005 09:09

I suggest that you try Hardys & Hanson as the next takeover candidate

[grebo] 22/8/2005 09:04

Where to after this one? I bought into Jennings and they were bought, now BHG. Which brewer will be the next to go?

[edmundshaw] 22/8/2005 08:45

Two cheers for Greene King. Price a bit lower than anticipated, would have hoped for nearer £7 - am I never sarisfied?! :-).

Some chance of a counter bid e.g. from W&D??? They may have their hands full, and would need to be quick...

[shirishg] 22/8/2005 08:16

Post removed by ADVFN

[luderitz] 19/8/2005 07:58

Speculation about possible takeover by Wolves or Green King again In F.T.

I believe.

Ed: Correction not the FT but the Times.

[paulf99] 11/8/2005 12:51

Edmundshaw - I believe you're right in your assessment; BHG still looks cheaper than some of its peers to my way of thinking. So I'm sitting on my shares and see what happens.

[ed 123] 10/8/2005 22:26

A bit of lazy journalism or just co-incidence? The FT article appeared two days after a similar write up was published in Shares magazine.

I read both articles and haven't sold any of my shares. As you say, bigbertie, why sell now if a takeover may come next year? I don't want to risk missing any bid.

[bigbertie] 10/8/2005 19:49

The drop on Monday probably caused by the FT article entitled "Waiting for the bid that might never happen". Well that could apply to any company, couldn't it?
The article was by Carlos Grande (Big Charlie?). It said that after the recent run the shares were in line with the sector. Also a bid might not appear "or at least not until 2006". It also said the effect of the smoking ban might be worse than expected, and that the shares "look fully valued".

Well that looks fine to me - a bid in 2006 is perfect. No doubt the shares will make further progress until then, thanks to bid speculation. And while the effect of the smoking ban may be worse than expected it may also be less hearmful than expected. I shall certainly go out for more pub nights when pubs are smoke free.

The article seems to be trying to frighten off investors by saying that things might be worse than anticipated. What a devastating insight.

[domtheone] 08/8/2005 16:36

Congrats to those that sold out today.

I guess the buyers will be thankfull ;-)

[domtheone] 08/8/2005 13:45

LOL!

Not that concerned.

2 x larger buys this morning, the rest, small (probably PI) sells...bailing out after a good run.

Still going to hold, belive this is a temporary dip. Can't go up every day. Had to happen some time.

Expect to resume normal course soon.

Now watch it tank!!

[grebo] 08/8/2005 11:27

You had to say it didn't you, look what you've gone and done to the chart ;-)

[domtheone] 05/8/2005 09:44

Sorry, afraid not.

Would look quite good at the moment though :-)

[paulf99] 01/8/2005 18:09

It would be nice to have a share price and volume chart on this board - anyone know how to do it?