Dod101 wrote:Folks here (notably RVF and Arb) have expressed great concern at the possibility of the current bidders asset stripping and loading up the business with debt. My newspaper this morning has got a two page spread telling us that that is not the intention of Fortress and it seems that it might even be that they are giving legally enforceable undertakings. Got to wonder why they are wanting to buy the company.
Dod
I read that, but I'm not sure such an undertaking can be made permanently. Are we being naive to believe that a property company would be content to leave it at that ad infinitum? Their long term interest would be in asset stripping the property as a separate property company and make a small fortune.
They have little or no interest in the stakeholders of this business, the existing shareholders, customers or farms - only in as far as they can squeeze all of them until the pips squeak. They'll wring it dry over a period.
This is nothing to do with enlightened capitalism but raw greed to make a fast buck.
To those who have written that I should be happy to have a premium price to the current depressed price, I can only say, that isn't particularly interesting to me as a HYPer. The dividends for MRW have been up and down according to market conditions, but they are at present increasing and I've no doubt the SP will follow when the market slowly realises it. Most HYP companies have gone through various stages like this, but that doesn't bother me as I am here for the long term: the investment is not for churning.
Of course, I don't deny MRW has not been the best investment, but that does not mean my patience has worn thin, especially not when all UK businesses clearly have problems of various sorts during Brexit/covid. The takeover is a curate's egg: on the one hand it is an example of market trading which gives the opportunity to refresh. On the other it's a wretched nuisance which goes wholly against the grain for a LTBH HYPer whose interest is only or mainly in the income over the long term.
I don't give much thought to the short term ups or downs of the share price: saying that I have a 40% premium to the currently depressed price means nothing to me (since I believe it will recover anyway of its own accord, and since I never intended to sell and realise that capital value) - except that someone knows a bargain when they see one and that tells me the management are useful fools to the predators and do not have the interest of stakeholders at heart.
Arb.