I refer to the following link, which is the precis of the PXUPA Prospectus and says the same things, but in short (of course, because it's a precis!)
http://www.paperlinx.com/investor-information/paperlinx-sps-trust.htm
Anyhoo, this part irks and fascinates me (it's edited for the bit I want to discuss):
_____________________________
PaperlinX's Realisation Rights
PaperlinX may cause the Issuer to Realise PaperlinX SPS in the following circumstances:
... if the aggregate Face Value of PaperlinX SPS on issue is less than $50 million.
______________________________
So, what is "Realisation"? The documnet says the following:
Realisation
Realisation of PaperlinX SPS may be by any one or more of the following:
Redemption (for cash);
Exchange (for PaperlinX Ordinary Shares); or
Resale (for cash).
______________________________
The $50m is a key figure, it seems to me. PXUPA's have a current price of $17.50. The market cap (which is "Aggregate Face Value") is $49,875,000.
My question is, does this <$50m represent a "trigger point" whereupon Paperlinx, the company, can call on the SPS Trust to realise the PXUPA's (if the PXUPA SP remains <$17.50, or have an aggregate face value of <$500m? From what I read, it seems they can! My other question is, will they?
There are three players in the PXUPA fiasco: holders (little to no rights to realisation, unless under takeover, which is possible, and an offer is hanging aroundf the table); PXUPA, the company, who can force SPS Trust's hand, and the SPS Trust itself, which noone seems to be discussing (unless I have missed seeing it).
The cash question, under realisation, seems to be unknown. The Trust has said that PXUPA's have a "value" of $34, in their latest ANN. This is more than the circa $21 (potentially) offered by private equity. Or maybe the "realisation" involves a price of $100- I don't know.
Since reading about this "realisation" a few weeks ago, I have watched the price of PXUPA fall and rise to this level, because the $17.50 price is significant, it seems. I may be very wrong here, but there *may* be a push you, pull me thing happening where $17.50 gets reached, and then powers that be push the price back up, so tat the potential trigger point does not stay there.
I would be very interested in the views of HC people re this. I haven't bitten the bullet yet, and quite frankly, the covenant issue has bothered me, and I am waiting, as I don't want to get messed up in another RPF situation (I tell ya, the distressed debt people are not about pretty outcomes- except for themselves- and they were mentioned in relation to PPX in an article in the AFR some time ago. I made reference to it some months ago, and can link it again, if desired, or just report that post I made).
Ideas, people, on the forced payout by the SPS Trust? I notice a couple of Directors from the Trust have resigned- a sign?
- Forums
- ASX - By Stock
- PXU
- can sps trust be forced to buy out pxupa's?
PXU
paperlinx sps trust
can sps trust be forced to buy out pxupa's?
-
- There are more pages in this discussion • 31 more messages in this thread...
You’re viewing a single post only. To view the entire thread just sign in or Join Now (FREE)
Featured News
Add PXU (ASX) to my watchlist
Currently unlisted public company.
The Watchlist
JBY
JAMES BAY MINERALS LIMITED
Andrew Dornan, Executive Director
Andrew Dornan
Executive Director
SPONSORED BY The Market Online