Whilst the announcement is benign, there is no meaningful progress on resolution of the German tax situation. I am surprised that it was deemed necessary to call a halt to trading.
In any case, I think this remains a good bet at 6c (for speculators only, of course - this is not an investment and you may wind up losing a significant percentage of your capital). You are partially protected on the downside by the non-recourse AUD cash (currently ca. 2.5c/unit) and whilst the NTA of 11c/unit is the theoretical upside limit, the assets are conservatively valued. If you believe, as does management, that the German tax situation is more likely than not to be resolved in favor of MUE, then this is a no-brainer.
Of course, we can't afford the sale process to drag on indefinitely - the standstill with the Financier extends only through September and the downside protection is being slowly eroded by property management fees.
With the benefit of hindsight, I am not sure that the return of surplus AUD capital was the optimal strategy for unit holders. If MUE had retained the AUD30MM in the fund, then the default would likely have already been cured and we would be talking now about recapitalization.
MUE Price at posting:
5.9¢ Sentiment: Buy Disclosure: Held
