BWF

2.69%

45.3¢ blackwall limited

Ann: Dividend/Distribution - BWF, page-4

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brightpower

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16/08/24

20:38

Post #: 75246376
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Originally posted by madamswer: ↑

This has to be one of the most unusual situations I've come across for many years, probably decades:

1.) BWF (trading at about NTA ) owns a 28% stake in WOT

2.) WOT makes up around 50% of BWF's NTA

3.) WOT, itself, is trading at ~50% discount to its own statutory NTA (closer to 60% discount if management adjustments are to be taken at face value).

4.) BWF is paying dividends via an in-specie distribution of the WOT shares it holds.

Needless to say, this sort of novel financial engineering structure (which is a recent arrangement for the BWF-WOT complex, having come into being in only Nov '23 and is something I'll wager very few people have bothered to try to understand) lends itself to potential for the stocks involved to become meaningfully mispriced.

It warrants noting that there would be a non-trivial cohort of BWF shareholders who have until now not been WOT shareholders, probably don't care to own WOT or, simply, want to receive cash, meaning that every time they receive their WOT shares as dividends, they promptly turf them out to replicate a normal cash dividend.

It also warrants noting that both BWF and WOT are illiquid stocks - WOT acutely so - meaning that the minute BWF goes ex-dividend and the in-specie WOT shares get issued, an abnormal level of selling of WOT can be expected.

This arrangement has only been in place for the past financial result, so as a case in point, on 5 April 2024 (the day before BWF went ex-dividend), WOT's share price was $1.17. Two months later it had fallen by almost ~30%, on negligible volumes.

And because, arithmetically, BWF = o.5 x WOT, a drop in WOT drags down BWF, as occurred over that ex-dividend period.

I expect similar non-discerning selling of WOT shares received as BWF dividend after BWF goes ex-dividend (on 20/09).

Which, if I'm right, will be pretty bizarre, because the starting point for any such indiscriminate selling would be a stock that is already at a 50% discount-to-NTA.

.

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I much prefer my divs.in cash but won't be selling my WOT when received,given the disc. to NTA .
Both BWF and WOT are out of favour(not unlike a lot of REITS) and more so given their almost pure office play.
Do you know what the"strike price" is for receiving the soon to be received WOT units?.I asked BWF only yesterday and have not heard.

BWF Price at posting: 44.0¢ Sentiment: Buy Disclosure: Held
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(20min delay)
Last 45.3¢		Change -0.013(2.69%)		Mkt cap ! $75.93M

Open	High	Low	Value	Volume
45.5¢	45.5¢	44.0¢	$5.511K	12.35K

Buyers (Bids)

No.	Vol.	Price($)
2	2771	44.0¢

Sellers (Offers)

Price($)	Vol.	No.
45.0¢	2	1

View Market Depth

No.	Vol.	Price($)
2	2771	0.440
1	2380	0.420
1	13068	0.405
1	5000	0.400
1	1494	0.335

Price($)	Vol.	No.
0.450	2	1
0.470	15000	1
0.490	38000	2
0.500	66112	3
0.510	8000	1

Last trade - 14.32pm 27/09/2024 (20 minute delay)

BWF (ASX) Chart

Ann: Dividend/Distribution - BWF, page-4

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