GNC - Graincorp Limited

[3 veiws of a secret]

With the slump in agri-business shares, do any of you think GNC is positioned well at current prices. I'm tempted to enter in at possibly $7.25 a share. Can't but think this is good price to pitch in after todays fall. Tell me it is so. :headshake

 

[BraceFace]

Seems to have turned the corner now.
I think it may be good value.
This drought can't last forever ... surely!

 

[BraceFace]

Nice bounce over the last 2 trading days.
Up almost 10% to $8.80

Perhaps the AWB situation is rubbing off. (AWB also up over last 2 days in expectatioin of Cole report)

Thoughts?

 

[traderandy]

Also ABB just announced record profit - up 60%

 

[BraceFace]

Well, GNC has been a stellar performer heading up to $13.00 plus on the back of a more positive wheat market.
Then it tanks.....
For no apparent reason.
Back down to $9.50 today after some steady declines with market nervousness over the last month or two. How can the sub-prime mess have any direct effect on this company - beats me.

Unless there is something else happening here, this is good buying.

 

[The Once-ler]

Don't ya watch the news Braceface?

The Aussie wheat crop has mostly had no rain for 6 weeks. It's turning to dust mate. I've heard that one hundred thousand tonnes a day is disappearing into the big silo in the sky for every day it don't rain.

That's the main problem.

 

[BraceFace]

Don't ya watch the news Braceface?

The Aussie wheat crop has mostly had no rain for 6 weeks.

Yep, must have missed that in between all the election posturing and BS.

There's been plenty of rain over west here, so maybe our news bulletins aren't so worried about the wheat/barley farmers.

Either way, GNC has been on the declined for the last 3 months pretty much, so there is something else going on I'm sure.

Share prices don't fall that much just because it's a bit dry in some parts of the country. We've apparently been in drought conditions for a few years now.....

 

[The Once-ler]

Share prices don't fall that much just because it's a bit dry in some parts of the country. We've apparently been in drought conditions for a few years now.....

Yeah, no worries mate. Just trying to help, but last I looked, GNC doesn't handle grain in WA, so what does it matter what the WA crop looks like to GNC? Graincorp handle grain in QLD, NSW, Vic, and SA, and things are going downhill fast. Sure there's been drought for years, but last years drought was crook right through. This year the season started good, crops looked good, and now their failing. No rain in 2 or 3 weeks and it will be the same result as last years crop. You can't tell me that a halving of total grain won't be the main reason for GNC's share fall?

 

[josjes]

Graincorp on the spotlight today, rises 16% today. The Foundation Share held by farmers through the Grain Growers Association, gave farmers the majority of seats on the GrainCorp Board plus the right to block any take overs or mergers.
GrainCorp chairman Don Taylor said removal of the share strengthened the company's ability to compete in contestable markets and to capitalise on future opportunities.

GrainCorp Shares Soar After Vote to Remove Grower Control

By Madelene Pearson
Enlarge Image/Details

Feb. 27 (Bloomberg) -- GrainCorp Ltd., eastern Australia's largest grain handler, rose by a record in Sydney trading after shareholders voted to remove the ability of farmers to elect the majority of the board.

The so-called foundation share will be scrapped after a vote at its annual meeting today, Sydney-based GrainCorp said in a statement to the Australian Stock Exchange. The foundation share allowed the Grain Growers Association Ltd. to elect six of the company's 10 board members.

The vote comes two weeks after AWB Ltd., Australia's largest wheat exporter, failed to win support from its grain-grower shareholders to change its dual-share structure.

``Simplifying the company structure is a significant decision for shareholders and will have a positive impact on the future of the company,'' Chairman Don Taylor said today in a separate statement before the vote.

GrainCorp rose as much as A$2, or 18 percent, to A$13.13 on the exchange and traded at A$12.85 at 3:09 p.m. in Sydney. That's its biggest gain since it began trading on the exchange on March 30, 1998.

To contact the reporter on this story: Madelene Pearson in Melbourne on mpearson1@bloomberg.net
Last Updated: February 26, 2008 23:11 EST

 

[michael_selway]

Graincorp on the spotlight today, rises 16% today. The Foundation Share held by farmers through the Grain Growers Association, gave farmers the majority of seats on the GrainCorp Board plus the right to block any take overs or mergers.
GrainCorp chairman Don Taylor said removal of the share strengthened the company's ability to compete in contestable markets and to capitalise on future opportunities.

GrainCorp Shares Soar After Vote to Remove Grower Control

By Madelene Pearson
Enlarge Image/Details

Feb. 27 (Bloomberg) -- GrainCorp Ltd., eastern Australia's largest grain handler, rose by a record in Sydney trading after shareholders voted to remove the ability of farmers to elect the majority of the board.

The so-called foundation share will be scrapped after a vote at its annual meeting today, Sydney-based GrainCorp said in a statement to the Australian Stock Exchange. The foundation share allowed the Grain Growers Association Ltd. to elect six of the company's 10 board members.

The vote comes two weeks after AWB Ltd., Australia's largest wheat exporter, failed to win support from its grain-grower shareholders to change its dual-share structure.

``Simplifying the company structure is a significant decision for shareholders and will have a positive impact on the future of the company,'' Chairman Don Taylor said today in a separate statement before the vote.

GrainCorp rose as much as A$2, or 18 percent, to A$13.13 on the exchange and traded at A$12.85 at 3:09 p.m. in Sydney. That's its biggest gain since it began trading on the exchange on March 30, 1998.

To contact the reporter on this story: Madelene Pearson in Melbourne on mpearson1@bloomberg.net
Last Updated: February 26, 2008 23:11 EST

Hi, its actually not too bad now

Earnings and Dividends Forecast (cents per share)
2007 2008 2009 2010
EPS -34.5 -30.9 49.9 70.1
DPS 10.0 0.0 40.0 49.0

Date: 24/7/2008
Author: Geoffrey Newman
Source: The Australian --- Page: 22
Australian rural group GrainCorp will not improve its takeover offer forstockfeed business Ridley Corporation. The announcement by GrainCorp MD MarkIrwin virtually means that the bid has failed, despite the deadline not arrivinguntil 26 August 2008. The recent decline in the predator's share price hasmade the deal unattractive for Ridley's investors. The combined entitywould have a significant share of the silos and feed mills infrastructure onAustralia's eastern seaboard. On 23 July 2008 GrainCorp stock closed at$A8.14, while Ridley's was worth $A1.11 compared with the offer price ofslightly more than $A0.90

Date: 24/7/2008
Author: Sue Mitchell
Source: The Australian Financial Review --- Page: 16
GrainCorp MD, Mark Irwin, admitted that his company's bid for RidleyCorporation may not be successful on 23 July 2008. Irwin said GrainCorpcontinues to value Ridley as a major customer, regardless of the outcome of the$A260 million hostile bid he launched in May 2008. GrainCorp shares have fallen37 per cent since May 2008, reducing the value of the Australian rural servicescompany's bid from around $A415 million to $A260 million. According toIrwin, both Ridley and GrainCorp stand to benefit from "new supply chainefficiencies" available through co-operation

thx

MS

 

[CAB SAV]

Bought in @ $5.23 few weeks back. Looking for marked growth in summer grain harvest figures due end Jan/early Feb. Could return to profitability 09.It's all about weather or whether.

 

[ridgey]

Any holders planning on taking up the GNC SPP in the next couple of weeks? Current price still approx 20% above offer price. ($7.43 current price over $6.25 offer).

 

[the barry]

Any holders planning on taking up the GNC SPP in the next couple of weeks? Current price still approx 20% above offer price. ($7.43 current price over $6.25 offer).

Yeah, I will take it up. I think it might be heavily scaled back, but we will see. With so many companies putting out there hands at the moment who knows.

 

[TabJockey]

I am buying in at 7.60, can definatly see a bounce to 8.50 or so in the next month.

Its probably one of those shares that is good to buy for the kids, god knows what the demand for foodstuffs will be in 20 years.

 

[skyQuake]

Wow that was a crazy match! Opened $1.75 too high! It's like the capital raising didn't even happen...

 

[skc]

Wow that was a crazy match! Opened $1.75 too high! It's like the capital raising didn't even happen...

I was so sure that was a mis print. Back to more reasonable level now.
Isn't the offer price something like $5.65, so a nice profit for existing holders.

All and all a great deal and great move by the management. Still doesn't stop them being a prey in the agri business consolidation game, but probably push the time table back a few months.

Discl. I hold

 

[skyQuake]

I was so sure that was a mis print. Back to more reasonable level now.
Isn't the offer price something like $5.65, so a nice profit for existing holders.

All and all a great deal and great move by the management. Still doesn't stop them being a prey in the agri business consolidation game, but probably push the time table back a few months.

Discl. I hold

You lucky dog you
At least management is being cunning and looking after the holders, instos got placed shares at $7.05 instead of same price as entitlement issue.

 

[NedFlanders]

Hi,

Somewhat inexperienced in all this (and hold approximately 1300 GNC shares) - a few days back they were approximately $9/share now down to about $7.11 9 after UMH acquisitition...

Can someone please explain?

Thanks!

 

[skc]

Hi,

Somewhat inexperienced in all this (and hold approximately 1300 GNC shares) - a few days back they were approximately $9/share now down to about $7.11 9 after UMH acquisitition...

Can someone please explain?

Thanks!

Howdy Ned,

Don't worry. The market actually loved the acquisition. To fund the acquisition GNC gone to raise more capital from institutions and retail shareholders. As a retail holder you are entitled to "rights" which allow you to buy 9 shares for every 10 shares you hold (so you get to buy ~1170) at a discounted price (I think $5.65). So if you choose to exercise the right. You will make some profit on those new shares based on the current price, and probably no worse off overall.

Not 100% sure what happens if you don't exercise that right. I think GNC will conduct a bookbuild (basically selling the shares that you didn't apply for on your behave) and give you some money back depending on what price they get.

It will all be explained to you in a letter coming from GNC, together with the rights entitlement documentation.

Okilly-dokilly?

 

[NedFlanders]

Howdy Ned,

Don't worry. The market actually loved the acquisition. To fund the acquisition GNC gone to raise more capital from institutions and retail shareholders. As a retail holder you are entitled to "rights" which allow you to buy 9 shares for every 10 shares you hold (so you get to buy ~1170) at a discounted price (I think $5.65). So if you choose to exercise the right. You will make some profit on those new shares based on the current price, and probably no worse off overall.

Not 100% sure what happens if you don't exercise that right. I think GNC will conduct a bookbuild (basically selling the shares that you didn't apply for on your behave) and give you some money back depending on what price they get.

It will all be explained to you in a letter coming from GNC, together with the rights entitlement documentation.

Okilly-dokilly?

Thanks for the explanation skc, that makes things clearer. I think I'll exercise the right. Much appreciated neighbourino!