Why precisely did AVB commission that professional and expensive Global Mining Research Report six months ago? Why? Was it just idle curiosity? Hardly.
If they felt the market was not reflecting their true value then they found an independent party and had themselves valued for shareholder information. That answer was 31c, in todays terms.
I can only think of that move as a defensive strategy against a takeover at a time when their unrealistically low share price did not reflect all the assets that it should. It left them vulnerable.
Did they feel the sharks circling? So as a company you answer the question in advance. What is AVB worth? and you do it if you feel especially that your value is well in excess of "analyst" views... and market price.
The AVB board were right. They proved it. Well done.
I see the GMS Report as a corporate defensive strategy, initiated by AVB.
All this stuff about what brokers say. Why is nobody citing the 29-page GMS report??
AVB does not need to call for an independent valuation now.. it is there for anyone to see... a mere six months old. Why repeat it.
Why does it never seem to get a mention except here? Shareholders paid for it after all. It was done for their benefit.
Would the GMS 31c (pre-Pantera) embarrass too many people who are afraid to come up with a value of also near 30c when the market was 7.7c? How long would they keep their jobs? hence the word "independent" Report for GMR.
The question is why is "fair" value 17c. Do these "analysts" by some sort of mutual consent want to huddle in a pack and proclaim 17c to be "fair"... when only six months ago according to GMS, AVB was valued at 31c.
I would like Barry FitzGerald in his column if fairness is his thing, to highlight this difference. If market value of 7.7c is used as a basis for comparison and generates the word premium, then why not use the independent and very thorough 29-page GMS Report that says fair value is 31c, and generate the word discount instead.!!
Fair?
Why ignore the other end of the Value spectrum. Why not even mention it...? Because perhaps it suggests the unpalatable to the broker club... that AVB is in truth massively undervalued.
That GMR are intelligent professionals who know.
Fair...the con-word everyone loves to use... mostly to their own advantage. (Who has heard of a fair tax? every tax is described that way. You are not against something fair are you? )
So why does GMR value AVB at 31c (or US $584m) when all the other wise heads reckon 17c ??
The financial media ignore the question.. under the carpet it goes... after all that is easier isn't it? No boats rocked.
I would love another bid, a top one... really belt them... not just for the $'s but also to sort of go right in the face of this "fair" mob....
.. sorry for the long post... but things get clearer with time, don't they
AVB Price at posting:
15.5¢ Sentiment: Hold Disclosure: Held
