Australia's largest stock trading and investment forum Australia's #1 stock forum

MGC

0.00%

43.0¢ mg unit trust

Worse Is Yet To Come?, page-1127

First 1127 Last

Share
Profile

Follow
usc75

7,026 Posts.

181

03/05/17

13:30

Post #: 24439842
Share

Originally posted by Amused observer ↑

Thoughts only as there are many ways in which MGC could move and it depends on what commercial levers the current Board and Executive Team push or pull. To try and guess their medium to long term intentions would be a SWAG but here is my view based on the issues rather than the opportunities.

Review and consider changing the company constitution to move towards a full ASX listing, now whether that be MGC as a whole or whether they split the company into MGC (retain as the cooperative) and just list Devondale, Liddells and MGC Ingredients. If they did this then MGC would effectively become the processed (i.e. pasteurised milk supplier to the listed company for its own value adding activities to produce product-to-markets). Combined with this could be the removal of the Unit Trust and the STP.

Review and consider changing the product mix and continue to move into higher value product and await the ACCC's decision in regards the $1/litre contracts with the retailers. If it stays then MGC have to honour it if not then they have a choice as to whether to pursue that domestic commodity market or shift the released assets to greater value market, whether they be onshore or offshore.

There are some external matters which probably limit which way they want to play so not all of the forward looking strategies can be unfolded until (a) the ACCC Inquiry is done and dusted later this year, (b) the ACCC Investigation is done and dusted for MGC so it knows its exposure and obligations as a result, (c) ASIC Investigation is done and dusted for MGC so it knows its exposure and obligations as a result, (d) the Class Action is refined to the point of MGC knowing what impact this will have on its D&O insurance and what, if any, spill over there may be to the company.

So for now the last announcement really indicates where MGC is at and what it needs to do over the next 12 months to get itself stabilised and in a position to move forward in a positive manner whilst managing the impact to many staff and families as a result of the closures of the 3 plants and keeping the business afloat for current suppliers and unitholders.

So is MGC in crisis mode? Not really it is currently more about damage control and re-assessing what it has and what is left to do to close a rather tawdry chapter.

Not very useful and probably incomplete on many fronts I suppose but I don't have a crystal ball...

Expand

2nd last para: with the lowest Farm Gate Price, it will lose many more farmers. It has already lost 25%. This in anybody's assessment is a CRISIS!

MGC Price at posting: 92.0¢ Sentiment: None Disclosure: Not Held
2 Upvote

0 Great analysis

Reply

Top Stories

Trump is President Again: What Does This Mean for Crypto?

3DA

To make modern missiles, you need 3D Printing. And in that gold rush, Amaero is selling shovels

MKT

The ASX can overlook its Telecomm small-caps. Here’s one diversified brand with an international footprint

AR3

Overland drilling proves promising for Australian Rare Earths' uranium hopes

CPV

ClearVue inks deal with UK heated glass player to combine solar tech with its offering

There are more pages in this discussion • 331 more messages in this thread...

First 1127 Last

Add MGC (ASX) to my watchlist

Worse Is Yet To Come?, page-1127

Top Stories

Trump is President Again: What Does This Mean for Crypto?

To make modern missiles, you need 3D Printing. And in that gold rush, Amaero is selling shovels

The ASX can overlook its Telecomm small-caps. Here’s one diversified brand with an international footprint

Overland drilling proves promising for Australian Rare Earths' uranium hopes

ClearVue inks deal with UK heated glass player to combine solar tech with its offering

Featured News