Yep, Office works doesn't work in the same space as Coles, it is more of a white collar Bunnings.yes i agree Office-Works is doing very well , and i believe owns some of the property where outlets are situated , however the fate of Office-Works has been discussed several times the WES discussions on the future of WES ( at management level )
why divest , well WES divested COL , maybe management can increase shareholder value by setting it free ( or at least a separate property trust ) i would prefer the property trust scenario , but let's see if anything happens at all
( it wasn't that long back WES divested it's coal interests , which were nicely profitable )
even worse, as there have been numerous Return of Capital events through the years. One for the accountant / estate !!Picked up Franked Income Fund a long time ago, they were absorbed into WES, then picked up more after the GFC when I retired and hold with div reinvestment. Never had a good reason to sell WES yet. The paperwork will be horrific if I ever do.
Yes I think estate resonates. Loleven worse, as there have been numerous Return of Capital events through the years. One for the accountant / estate !!
@divs4ever Also their rural outlets and insurance businesses also.yes i agree Office-Works is doing very well , and i believe owns some of the property where outlets are situated , however the fate of Office-Works has been discussed several times the WES discussions on the future of WES ( at management level )
why divest , well WES divested COL , maybe management can increase shareholder value by setting it free ( or at least a separate property trust ) i would prefer the property trust scenario , but let's see if anything happens at all
( it wasn't that long back WES divested it's coal interests , which were nicely profitable )
yes if you view them as a LIC with mostly unlisted assets ( an investment shell if you like ) you realize they will buy/sell what they think is a good deal at the time ( probably all the companies under the WES are for sale at a generous price )@divs4ever Also their rural outlets and insurance businesses also.
No longer the Co-op that my grandfather was involved in at the very start.yes if you view them as a LIC with mostly unlisted assets ( an investment shell if you like ) you realize they will buy/sell what they think is a good deal at the time ( probably all the companies under the WES are for sale at a generous price )
you may as well call WES an ETF in that case because, according to some, ETFs and LICs achieve similar results.yes if you view them as a LIC with mostly unlisted assets (an investment shell if you like)
from Aug 2022 ......, I listed some of these instances....there have been numerous Return of Capital events through the years.
Just clicked through these links. An Interesting corporate journey
am not crying about buying into WES , and i only started buying them in 2015Just clicked through these links. An Interesting corporate journey
the first one is Sales & Demergers
the second, much fuller and over the full 100 years, is Purchases and Mergers .
@farmerge .. did your ancestor keep the shares? There'd be some rich cockies out there, in WA.
DF when my grandfather passed on the Wesfarmers shares were divided up equally between the four siblings. I don't know how many thousands of shares were involved but when Mum got dementia my father gambled these and other shares that were gifted at the Perth casino. Hence the winner one James Packer.Just clicked through these links. An Interesting corporate journey
the first one is Sales & Demergers
the second, much fuller and over the full 100 years, is Purchases and Mergers .
@farmerge .. did your ancestor keep the shares? There'd be some rich cockies out there, in WA.
EDIT
I've been a holder for 30 years ... first purchase (not the last!) => check out brokerage + stamp duty. ...this is why Buy and Hold became ingrained
View attachment 174227
That is just hugley inept capital management by Wesfarmers. Because they returned all that capital then years later hugely diluted the shares outstanding when they acquired Coles for a stupid sum of money. They probably paid about a 50% premium to intrinsic value for Coles at the height of the boom (and this is not hindsight I pointed it out to every stock market investor I knew at the time). After overpaying for Coles with a lot of debt funding, during the global financial crises after the share price tanked they did an emergency capital raising at rock bottom prices causing the shares outstanding to go through the roof. Richard Goyder is a muppet yet despite a blunder of that size they kept him on as chairman for years after the event. The moral of the story is 1) don't overpay for acquisitions and 2) keep a chased up balance sheet so if opportunities you can take advantage without stretching yourself. Instead they returned excess capital to boost the return on equity short-term but paid the price for it later with huge dilution. A business like Wesfarmers (i.e. a highly active conglomerate) should not be doing capital returns. If you have some extra cash do what Berkshire does and hold onto it for a few years until an opportunity arises. That is better in the long run than diluting shareholders massively later down the track.from Aug 2022 ......, I listed some of these instances.
"As well as a steady flow of, and generally increasing, twice-yearly dividends, and the occasional special divi, there have been numerous Returns of Capital along the way
- 12/08/1998. $0.50 a share
- 18/12/2003. $2.50 a share
- 18/02/2005. $1.00 a share
- 26/11/2013. $0.50 a share .... 1000 shares consolidated by 0.9876 to 988 shares
- 16/12/2014. $0.75 a share .... 988 shares consolidated by 0.9827 to 971 shares
that wasn't the opinion i remember by analysts at the time , they were amazed WES bought it at the time as several suitors looked it ( COL ) over and walked away without even throwing out a number from memory that still had Myer's in the group and some considered the group toxicThey probably paid about a 50% premium to intrinsic value for Coles at the height of the boom
that seemed to be their specialty in earlier times , but is it still true , they bought Kidman Resources and Australian Pharmaceuticals and those results aren't in yetThe other interesting one with WES was Bunnings, in the 1970's and 80's Bunnings was the hardware store of last resort, always seemed to be expensive and mainly sold wood sourced from their mills.
Westfarmers bought them out and boom, made a silk purse out of a sows ear.
1994 ... 100 per cent of BunningsThe other interesting one with WES was Bunnings, in the 1970's and 80's Bunnings was the hardware store of last resort, always seemed to be expensive and mainly sold wood sourced from their mills.
Westfarmers bought them out and boom, made a silk purse out of a sows ear.
Again highlights the ineptness of the board. Issuing shares in 2001 to acquire Howard Smith then 2 years later doing a capital return. The board doesn't know if they are coming or going. A confused constant revolving door of capital. If as a company over time you know you are going to be a net acquirer of business (their acquisitions have exceeded their sales of businesses over time) then you should not do capital returns and should keep the dividend payout ratio low. That way you don't need to keep diluting shareholders with constant share issuances.2003 ..... $2.50 capital return
View attachment 174233
.. so , get criticised for an idle balance sheet, have to fend off those fancy boys looking to flip a good business. pimps in the towers trying to clip a deal with sincerity , not
We use cookies and similar technologies for the following purposes:
Do you accept cookies and these technologies?
We use cookies and similar technologies for the following purposes:
Do you accept cookies and these technologies?