Rugby Est It Share Discussion Threads

[purplebox] 24/3/2010 17:16

Final results out on Tuesday.

[badtime] 18/3/2010 20:38

Someone got out of ther 30k...bored?..profit taking? Who knows

[lavagrouch] 18/3/2010 11:40

Thank you Purplebox.
You're right, i see it's in auction again now.
Cheers,
Grouch

[purplebox] 17/3/2010 12:17

This stock is not SETS or SSMM - its SSQ3 and as such there are regular auctions throughout the day.

Recently (the last few days) we have seen a few uncrossing trades ('UT') as a result of these auctions - it's a good sign as it means interest is picking up.

[lavagrouch] 17/3/2010 11:53

In auction, not aware of any news, anybody?

[purplebox] 16/3/2010 17:31

A few buyers today at 53.0p.

[purplebox] 11/3/2010 10:28

The results are due at the end of the month and you can reasonably expect them to include the outcome of the Strategic Review - so news is coming soon.

The current expectation is that the new NAV will be around 80.0p - this is based on the revised property valuation to 31st Dec as stated in the RNS of the 15th February.

Also, there is no sell off - it's hardly been traded since the talks with ING were made public.

The current price is cheap IMO regardless of the result of the Strategic Review.

[badtime] 11/3/2010 10:06

This has slipped back..presumably on no news

[purplebox] 15/2/2010 17:05

There is nothing to reject at the moment.

Could take some time to shake out a deal as both sides will be playing hardball here, thats if they can agree a deal at all.

As time moves on and valauations improve, RUGB becomes stronger.

[overmars] 15/2/2010 14:53

NAV is now 79p based on the revaluation announced today. Offer is still 20% below real value. Reject.

[purplebox] 15/2/2010 08:51

I really can't see a price of 62.0/65.0 working - but that's not to say a deal won't be done.

[qwazi] 15/2/2010 08:11

Interesting... so not quite a done deal yet... suggests there may be scope for an improvement of the putative offer price (62/65).

[purplebox] 15/2/2010 07:29

Confirmation of talks from both IRET and RUGB.





Also, RUBG say property valuation up 7.5% in quarter to 31st December.

"Separately, and further to the announcement on 1 February 2010 regarding the ongoing strategic review being undertaken by the Company, the Board of Rugby REIT announces that CB Richard Ellis Limited has completed its external valuation of the Group's property portfolio as at 31 December 2009, valuing the portfolio at £68.3 million on a market value basis. This represents a like-for-like increase of 7.5 per cent. compared to the valuation as at 31 October 2009 (£63.5 million)."

My rough calculations now puts the NAV in the region of 80.0p - an increase of around 8.0p due to this new valuation.

[cerrito] 14/2/2010 22:27

I paid 61.5p a couple of years back and to be honest would take 62p cash and move on

[purplebox] 14/2/2010 19:35

qwazi -

Can't fault most your logic (other than I would argue that with Rugby Estates PLC backing they could be viable at the present size), but I do think a price of 62.0p is too low.

If the NAV is restated at around 80.0p next month (72.0p + 10%) a cash offer of 62.0p is a 22% discount.

Assuming that most (but not Terra) would go for a share swap, then perhaps the issue is really the highest achievable price that IRET's current holders see as good value - perhaps 70.0p rather than 65.0p.

The BOD's recommendation will be key here - a hostile bid might be difficult.

But, only newspaper reporting at present. Lets see what tomorrow brings.

[purplebox] 14/2/2010 16:39

What makes this interesting is that the original investors at 100.0p have seen a steady decline since they bought in - hence some (about 30%) of the shares are now owned by Terra (Laxey et al) who bought most of them at fire sale prices in March last year.

We have a stark difference between Terra who bought cheaply and are now looking to take a good profit, and the original investors who are looking to get their money back.

If ING are going to bid at 62.0p I would expect Terra to be more than happy, but it would still be an opportunistic bid IMO.

As you point out a REIT with no dividend is a bit like a pub with no beer - except that RUGB paid 2% to HMRC on it's purchases to gain access to REIT status!

The RUGB business model sounded good but they started at entirely the wrong time in the cycle. If they were starting today it would be very attractive but unfortunately their not.

Interesting times ahead here.

[topvest] 14/2/2010 16:15

Agreed that it's not a great deal, but it sounds like you can roll-over the position into ING's vehicle or take the cash. That vehicle has done even worse, down from 100p to the current 50p or so.

[purplebox] 14/2/2010 15:06

I know Terra are looking for short term profit here, but it would be a poor deal for the other shareholders - selling cheaply (below market value) in a market where valuations are increasing.

Remember that back in 2007 the shares were sold for 100.0p and the original investors are still looking at a loss here. These holders include Rugby Estates Plc with 8.5%.

Lets see what happens - there is no bid yet.

[purplebox] 14/2/2010 14:40

topvest - 14 Feb'10 - 13:15 - 59 of 62

I disagree, if you are exchanging your shares (@65p) into a similar vehicle that pays a robust dividend.

But is it best value for the shareholders - I mean apart from Terra?

The NAV was 72.0p based on a September 31st property valuation and the BOD have promised a revised valuation to 31st December soon. I'd guess that the NAV will increase.



The final results are due next month. Reading the 'defence document' produced at the time of the Terra bid last year the BOD included the following statement:

"Further to its previously stated intention, the Board is seeking to carry out a capital reduction which, if successful, would enable the Board to pay a dividend to REIT Shareholders by the end of the first half of 2010."

Why can't RUGB continue as a going concern? I'm I missing something here?

[qwazi] 14/2/2010 13:55

Considering the article was accompanied by a big pic of Colin Kingsnorth (of Laxey/Terra), I assume this deal has their blessing.

[topvest] 14/2/2010 13:51

Absolutely, an ideal merger from both companies point of view. IRET don't overpay. RUGB get an exit or shares in a better company, with a dividend yield. At the end of the day though, it's the big shareholders that decide on this. Terra are critical. For them it's a reasonable turn on their investment. Also, I'd be surprised for IRET to make a move unless they have Terra in their pocket.

[qwazi] 14/2/2010 13:36

...and IRET is on a 10% discount itself.

[topvest] 14/2/2010 13:15

I disagree, if you are exchanging your shares (@65p) into a similar vehicle that pays a robust dividend.