Ann: Change in substantial holding, page-40

Thanks franky1 for the good links.This is really starting to bug me!

OK I still have no idea what they are up to - but it is very important to look at the specific parties involved in these two notices:
* CSE (Aust) appears to have been buying and selling shares on-market (for cash) in a modest fashion - and at 2-May-2018 (and also on 3-May-2018 as no change notified) had a net 55,500 BGS shares - so no big deal... ;
* CSS (Europe) have been involved in no on-market trades - but have only borrowed or returned shares under their Master Prime Brokerage Agreement(s) with:
* L1 Capital LS (Master) Fund (2-May-2018) and L1 Long Short Fund (1-May-2018) collectively for 12,207,705 BGS shares; and
* L1 Long Short Fund (3-May-2018) only for a further 2,386,000 BGS shares.

Now L1 Long Short Fund is a new LIC on the ASX that has just raised $1.35 billion (in cash) and listed on 24-April-2018 less than a fortnight before these 'loans' occurred. The press are reporting that L1 Capital has returned (over a billion A$?) to their wholesale clients and replaced it with (higher fee-paying, closed end) retail/SMSF money in the LIC... [thanks franky1]

But the LIC was not in existence when many of those earlier transactions with CSS (Europe) occurred.

L1 Capital LS (Master) Fund is a manager of their Long Short wholesale funds.


Maybe this is part of the way they transfer a holding in a fairly illiquid stock between funds (there have been some XT trades?) - getting the retail fund set/positioned in stock previously held by the wholesale funds?

Or maybe this is part of the way that L1 Capital boost returns on their portfolio investments - by lending stock? (but then CSS (Europe) appear to be very active in borrowing/returning stock - why? In the last 4 months alone they borrowed 14 lots of BGS shares (often on the same day and sometimes quite small amounts , even though they had very large cumulative balances on hand) and returned 16 lots of BGS shares (sometimes on the same day that they borrowed). What is going on?

Looking at the recent Top 20s, these holdings must be being held in the JP Morgan Nominees holding (as at 23-Apr-18 it was 18,906,901 shares. But if CSH (Aust) is now declaring their entitlement to 6.35%, where have they come from, apart from L1 Capital funds (and why didn't they declare a 5%+ holding previously)??

The final curious angle is that the loaned stock carries voting rights (unless the lender directs the voting)? Nothing controversial at the AGM?

Not sure if we should be flattered that one of the highest returning managers, L1, are recognising BGS as one of their best 80 investments in Australia - or if we are just part of the shorting strategy for another of their Lithium plays...

Never a dull moment in BGS! What a book it will make...

GLTAH