Ann: CLH: Recapitalisation Transaction, page-8

The purchase of the NZ book has near-nothing to do with the banks. The PDLs belonged to CLH. As a matter of good relationship-building, CCP may have asked the original owners of the PDLs if they unhappy about the issue.

They way CCP would have gone about this matter is to evaluate the PDL Book pursuant to a target rate of return, and then added a sweetener to the effect that it and CLH share any better-than-target results, as happened in respect to the Australian book.

I have in the past wondered if CCP could not take the same approach when buying PDLs from banks in North America, and thus build a good relationship with PDL sellers. Good relationships are the essence of success in this business. I also wonder if CCP could not repeat the CLH-style deal with distressed debt buyers in the US. When CCP bus a business, like it did with NCML six or so years ago, it in effect bought the business at the value of the PDLs alone. NCML was then owned by TGA, so it is not too surprising that CCP recently acquired Radio Rentals - probably for the price of its book, plus a sweetener if collections exceed target. I assume that when CCP acquired Baycorp, the storyline was similar.

CCP has so frequently indulged in the such book-buying ventures that it would be strange if there were not more to come, and that is why Management keeps CCP's finances so liquid, which is completely different to the norm in the PDL sector.