Ann: Change in substantial holding, page-8

Hi @caketin and others

Its a very well researched article and will have facts that I knew but that I assume most shareholders won't have known. I have sold out because of the relevant risk that I see right now in PGC. The risks are outlined in the article but I think that the impact of the changeover is hugely understated.

It's my understanding that they have lost a few people which is normal in any roll-up. Personally, I think its fair value around 40c to 45c given the fact that it seems to have a few rocks in the path ahead - So if I owned I probably would hold to see the next set of results and decide on each bit of news. I am unhappy that management announced that it wanted to dispose of certain entities within the group way before they had done their homework in making sure that there would be a willing buyer at a reasonable price for these entities. So what they define as continuing business vs non-continuing business is really only in their own minds as to date over 6 months later no sale is forthcoming.

So my issues are:

1. The cost escalation that has now been addressed ... I question how it arose in the first place. I question whether the cost out won't put pressure on the growth. If cost out is people - what is the impact into the future.
2. As I understood it the accounting systems were all migrating to SAP Hana a more than an adequate program in my opinion - now once again they are migrating to a new platform. This process of change and trying to create a homogenous group all with one banner is, in my opinion, the very reason many M&A fails. Why would you assume that you need one group as that will probably result in many products drifting to the bottom of the pile? Having a large corporate structure for what is a population which is smaller than Texas makes little sense to me.
3. The big question is this: Is Mr AJ the right person for what is a small player with less than 3% of the market - it's my impression that his previous roles were with much larger multinationals?
4. I am also unhappy that the Chair has got other investments in a medical business that was delisted recently as I understand it.
5. The people I invested in have all left.
6. I am of the opinion that there are some investments that don't fit - Midas is one - it's still in a development phase.

It's still on my watch list but the likelihood of my reinvesting in this remains low. I have taken my profits and am very happy that I did, given the price it is today. It's sad but sometimes you have to move on.

So for me, this isn't on my radar right now but I keep watching hoping for it to get me excited again.