In my opinion: "That is the whole point! They should have wound up sooner! (or just stopped trying to grow in an unsustainable way). They were loosing money, sometimes holding NTA (in addition to expected future performance fees and accrued tax losses) above the share price. Shareholder's were entitled to obtain the value of their assets, investment teams were not entitled to be maintained/use the company as their personal ATM.
Oaktree was also clearly incentivised to put the company into accelerated repayment of debts, who would sign such a deal, who would keep wasting so much company money that it gets the cash position this low. Clearly the a lot of the "growing"costs where spent on marketing before the short, if this resulted in almost no new customers then why waste the rest of the 100 million on more marketing attempts. Why pay Robert Shand a termination payment if he quit?
If EY didn't fail in their responsibilities then where is our $250 million dollars of capital. Someone owes, 100+100+50 doesn't equal 0. So many big investors invested in this also, where they also wrong? Was Oaktree also just wrong? Alternatively if it was obvious to Oaktree that BLA would not meet its obligations to Oaktree then it was more obvious to BLA staff.
I did read the annual reports, several times... The annual report actually doesn't explain anything new about Okatree. The independent report was not in regards to the Oaktree contract itself being in the best interests of shareholders, it was a report about whether the conversion rights were in the best interests to help our decision. Here is what was in an a results presentation: "We were faced with two options: to continue business as usual and slowly seek to rebuild that confidence; or to secure third party support to accelerate that process".
They also stated that without Oaktree they would be able to "tough it out" meaning they could have kept on operating. I have not heard of their staff getting better jobs elsewhere so the "we turned down other job offerings cause we wanted to help Bluesky (whilst they got an additional $5 million in additional retention bonuses)" doesn't quite cut it. Also, that their performance was not exactly great proves that that BLA could have found better value employees elsewhere. Never once did they explain consideration of return of capital to shareholders through asset sales. Morrison is now buying the "real assets" business off of Oaktree's fund, I wonder how he came up with the money or how Oaktree came down with his price?
As you said "not the best option" therefore not in the best interests of shareholders. But continuing the high salaries may be in someone's interests.
But above all do you really trust the director's words in the annual reports and EY valuations given history?
In regards to what was previously said by directors:
-If the loans where NOT to prop up bad investments (stated by Kim Morrison (who also said he was making a bad bank of non performing loans in an article)) then why was there so many non performing loans?
-How is BLA the first to be attacked by a foreign short-seller (stated by the chairperson) when that same short-seller had already successfully short attacked Quintis?
-They said they judged Oaktree by its actions, clearly then they understood the likelihood of predator behaviour given its history which leads us to consider what more secret/confidential deals were made and why they consistently opt to have so much kept confidential including the court case agreement.
-Also stated was that Oaktree and BLA had the same clients therefore Oaktree would be hurting its clients by damaging us. This is complete nonsense if the investors of the funds are still looked after (ironically they are now looked after by the person who said that).
They also claimed to be getting costs under performance fees. Yet, the excuse for receivership was based on a cash based profit problem. Also where are all the new investments that they said the money was for?
How is putting a loss making company into this loan agreement in its best interests? Alternatively how was it loosing cash if the future was looking so good. Why was everything value downgraded when Morrison was the CEO at the time of the deal, despite being audited as profitable during the previous CEO and now we hear of those downgraded (mostly student accommodation investments) exiting above carrying value.
Don't forget Byron Beath and Kim Morrison are both from Macquarie Bank and it was very interesting timing when the announcement of both the Oaktree agreement and Macquarie's buy and sell notices. Continuously we find more and more interesting "coincidences".
Why all the secrecy by so many parties, if there is nothing to hide?
This will keep on happening until someone bothers to stop it. End of my opinion.
BLA Price at posting:
18.5¢ Sentiment: None Disclosure: Held
