Ann: Brierty Limited Extended Suspension Request, page-7

To make up for the dearth of news, this post covers the fond thoughts of an idle mind on BYL.

I have in the past compared the BYL as I knew it then with the then SWL (Seymore White), and I wondered why SWL's PER was so much higher. On the Yahoo-Skill spectrum, SWL undertook more advanced road-cum-bridge construction than BYL did (in Gulliver's Travels, the Yahoos were low-calibre humans who performed brutish tasks for a race of intelligent horses). In subsequent years SWL share price tumbled, as one would expect, but so did BYL's share price tumble for reasons we know too well.

The interesting point is that SWL's SP rose recently when a French firm, Vinci, suggested a takeover, and it was given access to information to allow it to perform a due-diligence exercise. One of the reasons for the mooted premium Vinci has touted is that by paying a special dividend, it can unlock a large chunk of SWL's franking credits. BYL too has franking credits that an astute suitor could unlock, but unlike SWL it does not, I think, have the skillsets to be attractive to an International company like Vinci (e.g., the likes of Salini, or Bouygues). However, for a local, like NWH, BYL could be attractive for the following reasons:

• Both NWH and BYL are based in Perth, so immediate savings could be made (terminate BYL's upmarket headoffice premises for starters), and it would be easier to deploy staff, and equipment in both directions.
• The combined JVs that both firms have with Aboriginal companies would be valuable in the mining-services business where engagement with Aboriginal interest is the “sine qua non” of many deals.
• BYL's Western Turner Syncline (Stage 2) contract with RIO would be attractive for NWH.
• BYL has business in the urban-development field that would be an attractive bolt-on for NWH, and this also adds some geographic expansion to the NT.
• NWH brings to BYL a proven management – a factor that BYL has lacked ever since its float at 50c about a decade ago.

NWH's lack of funds would be a minor problem, because a specific acquire-BYL capital raising could be the subject of a compelling prospectus, especially if a special dividend is included that can make something of the franking credits. The merged company could itself attract an acquisition offer from the likes of Salini.