I hadn't spotted that - thank you for the heads up.
At today's B$5.67 : US$1 and deducting -US$142m of costs the B$4352m holding translates to $767.5m and -$142m gets me to $625.5m. This is above the $587m disclosed.
My worst case estimate was £12.53 but at 1.29USD:£1 I get to £13.70 per OCN share.
I can also see there was an October 24 dividend from Wilson & Sons worth $15m to OCN too (33p per OCN share). No quarterly dividend since however strangely.
Meanwhile I think the US rotation should be reasonably positive for the portfolio of funds although some did sell off a fair bit during the recent Trump Harrump(h)
Yes, based on the RNS 21/10/24 "The Company expects up to US$142 million (calculated using the Applicable Exchange Rate) to be withheld by SAS pursuant to the Brazilian capital gains tax regime (estimated on a reasonable worst-case basis). The Company expects to ultimately realise net cash proceeds of at least US$593 million (calculated using the Applicable Exchange Rate) as a result of the Transaction, net of transaction costs and taxes".
I have now bought this, as WShak on X says, "in size". Of course, when WShak buys in size I get the strong impression we are talking very big numbers but it's all relative. Bought my first chunk last week then more yesterday and today when the SP didn't really move as I expected.
For entertainment value I asked Grok to take a look. Results here:
"The Wilson Sons disposal could nearly double the company’s net asset value per share post-tender offer, and the current price reflects a steep discount to that scenario".
Good morning - Are you able to explain what this means in practise for shareholders - I have no idea if its good news or not?! From the announcement yesterday: "the Board confirms that it intends to return a portion of those net proceeds to shareholders by way of a tender offer for up to 7,072,608 ordinary shares of 20 pence each in the capital of the Company (the "Shares"), representing 20% of the issued share capital of the Company" Many thanks.
So if you own 1000 shares and their price is £8, but the net asset value is £10 then might do a tender offer for £9.60. So you get 20% higher price than selling the shares but a 5% discount compared to how much they're worth.
Remaining shareholders (the 80% of shares remaining) meanwhile now own shares worth more than £10 because the NAV has increased, since they've lost £9.60 per share of cash but the assets are divided among 20% fewer shareholders.
Hope that makes it clearer.... I speak of a potential for a tender offer in the article so you can see how much it can potentially add! (i.e. it's a positive move in my view)
Impact on Hansa? Tremendously helpful analysis - thank you very much for all the hard work! Picking up on another of your posts - do you think that the better bet is HAN or OCN now that the sale of Wilson has been confirmed? Regards, Andy
Hi Andy, it depends on your perspective of USD vs Brazilian Real, plus the investment portfolio.
If you think the investment portfolio is strong (and my articles examine this and find positive reasons to say even though history is poor, future returns may be better) - then HAN could be the better pick with a bigger proportion, plus with a discount to assets which are also on a discount so a larger look through.
But if you consider Wilson Sons the “better asset” you get much more of that via OCN. Also if you are positive about the USD/Real FX rate (which is at an extreme low vs history) for later this year.
Another point is HAN is majority owned by 2 families; OCN is not. So you might prefer OCN that the 2 families are <50% owners.
A final point is that OCN has a tighter spread but that does vary so you might take a bigger hit buying HAN.
Also worth noting that there is a $ 80m break clause if the sale of the Wilson and Sons stake does not go through
Regulatory Approval given to Wilson Holdings for the SAS sale to go ahead did you see Oak?
As much as c. $16 special divi less costs now on the horizon for OCN shareholders. Land ahoy.
Hi Nick,
I hadn't spotted that - thank you for the heads up.
At today's B$5.67 : US$1 and deducting -US$142m of costs the B$4352m holding translates to $767.5m and -$142m gets me to $625.5m. This is above the $587m disclosed.
My worst case estimate was £12.53 but at 1.29USD:£1 I get to £13.70 per OCN share.
I can also see there was an October 24 dividend from Wilson & Sons worth $15m to OCN too (33p per OCN share). No quarterly dividend since however strangely.
Meanwhile I think the US rotation should be reasonably positive for the portfolio of funds although some did sell off a fair bit during the recent Trump Harrump(h)
OB
That's nice Oak. Does that include the deduction of Brazilian withholding tax?
Yes, based on the RNS 21/10/24 "The Company expects up to US$142 million (calculated using the Applicable Exchange Rate) to be withheld by SAS pursuant to the Brazilian capital gains tax regime (estimated on a reasonable worst-case basis). The Company expects to ultimately realise net cash proceeds of at least US$593 million (calculated using the Applicable Exchange Rate) as a result of the Transaction, net of transaction costs and taxes".
So basically just above mcap then. Neat.
I have now bought this, as WShak on X says, "in size". Of course, when WShak buys in size I get the strong impression we are talking very big numbers but it's all relative. Bought my first chunk last week then more yesterday and today when the SP didn't really move as I expected.
For entertainment value I asked Grok to take a look. Results here:
https://docs.google.com/document/d/1A7x3IlkyRnGqNWMTQ-2cLuEwtxM2X9LhwweFyXG3aws/edit?usp=sharing
"The Wilson Sons disposal could nearly double the company’s net asset value per share post-tender offer, and the current price reflects a steep discount to that scenario".
Good morning - Are you able to explain what this means in practise for shareholders - I have no idea if its good news or not?! From the announcement yesterday: "the Board confirms that it intends to return a portion of those net proceeds to shareholders by way of a tender offer for up to 7,072,608 ordinary shares of 20 pence each in the capital of the Company (the "Shares"), representing 20% of the issued share capital of the Company" Many thanks.
Andy, a tender offer is a buy back of shares.
So if you own 1000 shares and their price is £8, but the net asset value is £10 then might do a tender offer for £9.60. So you get 20% higher price than selling the shares but a 5% discount compared to how much they're worth.
Remaining shareholders (the 80% of shares remaining) meanwhile now own shares worth more than £10 because the NAV has increased, since they've lost £9.60 per share of cash but the assets are divided among 20% fewer shareholders.
Hope that makes it clearer.... I speak of a potential for a tender offer in the article so you can see how much it can potentially add! (i.e. it's a positive move in my view)
OB
Impact on Hansa? Tremendously helpful analysis - thank you very much for all the hard work! Picking up on another of your posts - do you think that the better bet is HAN or OCN now that the sale of Wilson has been confirmed? Regards, Andy
Hi Andy, it depends on your perspective of USD vs Brazilian Real, plus the investment portfolio.
If you think the investment portfolio is strong (and my articles examine this and find positive reasons to say even though history is poor, future returns may be better) - then HAN could be the better pick with a bigger proportion, plus with a discount to assets which are also on a discount so a larger look through.
But if you consider Wilson Sons the “better asset” you get much more of that via OCN. Also if you are positive about the USD/Real FX rate (which is at an extreme low vs history) for later this year.
Another point is HAN is majority owned by 2 families; OCN is not. So you might prefer OCN that the 2 families are <50% owners.
A final point is that OCN has a tighter spread but that does vary so you might take a bigger hit buying HAN.
Hope that helps,
OB
Really appreciate you taking the time to share your insights. Regards, Andy