2 x ASX announcements:-LLC buys PTN assets which are managed by...

2 x ASX announcements:
-LLC buys PTN assets which are managed by LLP for $76.75m
-LLP gets a "grant of right" to "consolidate the owner of the properties" which lapses by June 2001.
- LLP continues to manage PTN assets under existing arrangements
- PTN has option to re-purchase mgt rights from LLP option expires June 2010
- to exercise option PTN must pay LLP $42 - $45m cash.
- in recognition of new valuation of mgt rights, LLP will w/down the value of the mgt rights in its accounts by $20m.
- ALSO - LLP says it is CONFIDENT that it will reach an agreement with banks to reframe its covenant levels, but will probably reduce the level of its facilities.

Except for w/down of mgt rights, it seems this is all good news for LLP:
- it resolves all the issues with PTN
- it will allow LLP to work with LLC to enhance value of those villages
- if PTN exercise its option to repurchase mgt rights, LLP will use proceeds of $42m odd to further reduce debt (which will go towards paydown of expensive LLC c/Notes)
- it gives LLP a right to purchase assets out to 2011 !!!
- further cements LLP and LLC - it clearly shows the commitment of LLC to LLP !!!!!!!!!!
- the w/d of mgt rights was probably included in the $30m already announced? not clear about that yet.
- the fact that LLC is stumping up a further $76m seems to me that LLC is building up its retirement assets. There is no way they would leave these mature assets in LLC. They sit naturally in LLP - not LLC. Somehow these assets WILL get into the books of LLP.

LLC is going to want returns in the form of dividends ASAP. LLC clearly has confidence in the mgt and business of LLP.

cheers