Nail on the head - last two posts. FBU has always been a highly...

Nail on the head - last two posts. FBU has always been a highly complex business controlling channels to market and the contracting business has previously been a very healthy contributor.

I've personally been a believer that the parts are worth more than the whole and a spinning off of Construction to shareholders to properly isolate the business makes a lot of sense.

The key problem with the construction business stems from decades ago. The last foray into Australia was a lesson on how now to do things and a grand scale and ultimately the Australian operations were shut down. The old guard were ruthless and pretty much threw the baby out with the bath water when they shut down Australian operations. This being right at the start of the largest and longest running construction boom in Australian history. Big mistake. Returning back to NZ with tail firmly tucked in the Construction side of the business was mandatorily confined to NZ and South Pacific only. This isolationist policy, despite Fletchers massive dominance (in NZ) in supply chain control, has left the business a soft target for all comers to challenge. It has restricted the pathway for upwardly mobile staff movers and shakers without a pathway for expansion despite opportunities in other divisions with Australian and even further afield. Without fronting their demons in Australia there demons have also come to see them in NZ with Leighton's taking key contracts including transmission gully. Now also with HEB taken over with a large multinational backer transforming them to a main contender rather than side kick to the larger mainstays.

Fletcher's still have the systems and people and clout to turn this around, they have competitive advantages few others have, and just need to get back on the front foot. The last of the old guard are gone who could not have a construction success in Australia un-doing their decision to leave. It will be interesting to see if Kernahan can unshackle the team. Losing a test in Australia never stopped the All Blacks going back, they just dust off and plan and execute better. Learn to play hard in the international league and the domestic league competes harder to get into the international team. And when construction hums so does the hole group.

My pick is they whole sink and garage where thrown into this profit down grade and FBU is now well and truly oversold. Currently MCap looks like they've just given away a couple of divisions for a single $1 rather than stuffing up a couple of contracts.

Will be dabbling tomorrow. All this in my humble opinion, do your own research.