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NUF - Nufarm Limited

Discussion in 'Stocks I-P' started by Ken, Oct 27, 2006.

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  1. Ken

    Ken

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    nufarm have come up on the radar.

    recommendation as a buy on westpac broking.

    It seems undervalued.

    Would people be steering clear of nufarm due to weather conditions?

    intrinsic valuation is $11.50
     
  2. 3 veiws of a secret

    3 veiws of a secret 3 veiws of a secret

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    Ken are you stalking my portfolio????? try this link and I know its a long listen but it gives you a good cross section of where they are coming from and going too..........I normally click windows media symbol top r/hand corner......
    http://www.sharescene.com/index.php?act=radio
     
  3. Ken

    Ken

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    lol,

    nah just looking for some companys undervalued.
     
  4. niknah

    niknah

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  5. bigdog

    bigdog Retired

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    http://www.theaustralian.news.com.au/story/0,25197,22901815-643,00.html

    Shares hit after $3bn offer disappears
    Geoffrey Newman | December 11, 2007

    INVESTORS hammered shares in pesticide maker Nufarm yesterday after its Chinese suitor unexpectedly pulled out of a $3 billion agreement to buy the company.

    But there is still confidence the company will eventually be sold.

    Nufarm shares plunged more than 12 per cent after state-owned Chinese chemical giant ChemChina told Nufarm it was unable to put forward a concrete proposal, with the deal's failure being blamed on credit markets.

    Nufarm entered an exclusivity deal with ChemChina and its private equity partners when the offer was announced on November 5. That deal was due to expire last night but it apparently became clear over the weekend that the takeover consortium was unable to come through with a detailed proposal in time.

    "The consortium has advised Nufarm that it will be unable to formalise its proposal prior to the expiry of the exclusivity period and, accordingly, discussions between Nufarm and the consortium have ceased," Nufarm said in a statement yesterday.

    Nufarm had recommended its shareholders accept the offer of $17.25 a share, plus a special dividend of up to 30c a share.

    The deal - the biggest so far between Australian and Chinese companies - would have combined Nufarm with the largest pesticide business in China to create a group with $2.6 billion in annual revenues, described as the global leader in off-patent crop protection.

    The supply of debt finance, which had dried up in the wake of the US sub-prime loans crisis, appeared to be improving in early November when the Nufarm deal was first announced, but credit markets unexpectedly deteriorated again less than a fortnight later, driving back up the cost of money needed to fund the deal.

    It has also been suggested that there was tension between the Chinese, who were focused on the longer-term performance of the business, and their US private equity partners Blackstone and Fox Paine, who were concerned about the shorter-term economics of the deal and therefore were more sensitive to the cost of funding, which effectively doubled since the crunch began mid-year.

    Nufarm chief executive and major shareholder Doug Rathbone is understood to be particularly annoyed at having his attention diverted from the business for a month for no result, especially since it was never formally up for sale, but was enticed by the high price offered.

    A company spokesman yesterday described it as a "very onerous and distracting process".

    "We are disappointed that the deal couldn't be completed," he said.

    But many in the market still expect an eventual takeover of Nufarm.

    The company says a number of parties have expressed interest in buying the business.

    From here you can use the Social Web links to save Shares hit after $3bn offer disappears to a social bookmarking site.
     
  6. nioka

    nioka

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    Today I bought 20l of Roundup. The price has gone up 50%+ since I bought the last pack. Accompaning the pack was a leaflet explaining the price rise. The reason was a shortage of product because of excessive demand. Now the cost of production and distribution hasn't gone up 50% so the profit margin must be much higher than before. Add this to the easing of the drought in the cropping areas and Nufarm must be heading for a bumper year.
     
  7. chops_a_must

    chops_a_must Printing My Own Money

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    Yeah, I've been chatting to someone privately here about NUF. Services to agriculture are probably a good place to be. Aren't too many though. IPL is the other that I am in.

    Talking to a few farmer clients of mine, they were saying roundup has gone up something like 300%?? in the last year. Something stupid anyway. And there is shortages of bulk supplies because of the demand and summer rain. So farmers apparently are on selling it to others at a fair markup.

    Just waiting for a suitable entry on NUF here...
     
  8. Dutchy3

    Dutchy3

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    Short on this one today ... this could really fall out of bed from here. Had a lunge to the south a few weeks ago and managed to catch itself back ... will it recover again soon?
     
  9. Bluebeard

    Bluebeard

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    Whats peoples views on this stock, Im looking for more information and in the process of doing my research, if people are looking at ag services industry would people be preferring IPL or Nufarm or maybe something else.
     
  10. roadtripping

    roadtripping

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    Watching & tempted to get into Nufarm, most major brokers also recommending at present - for what that's worth. But am a little frightened still by their current debt (Debt/Equity ratio 73.6%) esp. with them still buying up their o/s competitors. thoughts appreciated....
    Felix.
     
  11. cheeyeen

    cheeyeen

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    Just wondering anyone knows why NUF falls today? I am tempted but would like to know whether there is any change of conditions.
     
  12. haunting

    haunting

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    Old bad news, on the 17/6 - downgraded its earnings guidance for 2008-09. It cut its forecast by 15 per cent to a net operating profit of $A187 million. It blamed the downgrade on a fall in glyphosate sales. The company has just raised $A300 million in capital.

    The cap raising was at $11.25 per share closing date 23/6, which probably explains why the dump today.

    The good news is at the current price, the stock is quite oversold, I am expecting a bounce from this level (if lower @9.00), soon.
     
  13. cheeyeen

    cheeyeen

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    Thanks Haunting, I also just saw the news that Credit Suisse downgrades the stock to underperform, and profit forecast to below NUF's management guidance citing deterioration in outlook for glyphosate which is 35% of sales for NUF business.
     
  14. dmagnus

    dmagnus

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    $7.5 would be a good price*********



    15% downgrade hmmm.... looks ugly
     
  15. outback

    outback

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    From under $9 to close at above $11 in a couple of days, interesting. Today they come clean on a takeover, so who knew what before the announcement to start the ride? Now where to from here?

    It's times like these I feel like a punter at a horse race.
     
  16. oldblue

    oldblue

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    Of course this didn't come entirely out of the blue - the Chinese had tried before and to a lot of investors it was only a matter of when they would try again.
    A combination of a depressed market, a profit downgrade from NUF and subsequent drop in the SP were all the ingredients needed to re-ignite a bid.
    I bought a few today because I reckon NUF is a well run company with a good business and prospects. At $10-$11 I'll be happy to hold, whether or not this situation develops into an actual offer.

    ;)
     
  17. sidious

    sidious

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    Seems like China is buying a lot these days? But have they bought anything that's overpriced. GCL? OZL? RIO almost, GMG, and so on and so forth. Poin is they will not lose face by buying an overpriced item. They would most likely wait for the next downturn to buy again. Very wise business people. Of course they will haggle down the price.

    In consideration of the above, my fair price for my NUF holding bought at $9 is $35.:D . That's a bargain!
     
  18. persistentone

    persistentone

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    Can you summarize the previous Chinese bid for Nufarm? Who was the buyer, and what was the price? When was the offer made, and what broke that deal up ultimately?
     
  19. oldblue

    oldblue

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    Have a look back in this thread, particularly the links to news items provided in posts 4 and 5.

    ;)
     
  20. persistentone

    persistentone

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    So based on that history, the bad credit markets, and the improbability of getting any competitive bidding started, I guess we should not hope for more than a AUD $14 to $16 bid?

    What is the relationship between the entity making the new bid and the different Chinese company that made the bid in 2007? I guess it wouldn't hurt to look at the new bidder's financials and see what they can put together out of pocket without attracting debt financing.
     
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