Guesstimates for AMP 2020-21, page-291

Also news of the return of surplus capital, which could be anything at his stage.

• A buyback of 10% shares at below $1.60. That would show sound capital management by making a profit on the CR stock. It would also underwrite the share price at a higher level than it is trading or likely to trade for some time. The original $780m cap raise was sold as necessary to start the implementation of the reinvention strategy in light of the delay caused by the delay of the sale. So in reality it is also surplus.
• A special dividend of up to 32 cps given that the estimated surplus capital is $1.1 billion. The fact that they already have $780 million from the cap raise the surplus is likely to be higher but the company have been very opaque on the actual surplus even though they have made announcements and not chosen to announce the actual surplus or the plan...very poor management imho.
• The reinstatement of dividends could be announced which would reinstate AMP into the realm of income stocks which would also be positive for the share price and underwrite a higher value. The difficulty with this potential announcement is that earnings are in decline and therefore the outlook for 2021 is 50% down and little prospect of a quick recovery is likely, So lower for longer seems to be the only likelihood.
• A listing of AMP Capital with an in-specie distribution of say 50% of the shares to AMP shareholders would be a very big and sensible strategy. Given that they have announced a "new" strategy for Capital, it will need to be of some significance. Simply stating that the team has been restructured and the business is focussed on real assets growth funded by non-AMP entities will be seen as a big yawn. So to be meaningful and of consequence it will need to be structural. Maybe they will also buyback the 15% of Capital owned by the Japanese? One thing is clear is that Capital can not be separated from Wealth totally as the interconnection of Wealth as a source of funds is just too significant. Perhaps the "new" strategy will be designed to reduce this dependence and create a truely independent asset manager. As an aside, Capital hands the majority of its funds to third party asset managers and should really be classed and a funds administrator rather than manager. Also if I were the "rainmaker" and was so obviously encouraged to stay and become CEO, I would want my own company as my alternative would be to start my own and in this industry there is far more money than talent and so setting up your own asset manager is standard operating procedure. Look at how many funds have been started by employees of Perpetual.
• The resignation of Francisco...unlikely but he is looking like a 2IC rather than a leader. I suspect that Murray is far more involved than is appropriate for a non-executive chair. At some point he must step out of the shadows and get on the front leadership foot. To date he has been the quiet apostle.

Either way, I will take the risk and buy today on the speculation that the "new" strategy and the much anticipated announcement relating to surplus capital will bump the price.