hybrid divis - why suspend for 2 years?, page-10

Cheers boomer,

The way I read it now is that Elders have the option at 30 June 2011 to either (a) increase the margin by 250 basis points, or (b) undertake a remarking event - which I see now is really an escape clause if they could get away in 2011 with offering a margin of less than 470 basis points (ie. the current 220 margin + 250 default increase).

Exiting (either for cash or shares) is only a possibility under a successful remarking event.

Given the Elders presentation on Friday, and the risk now implied in holding the PA's (uncertain distributions), I'm guessing very few investors would accept 470 basis points under a remarking event. Hence unless something unexpected occurs, we can probably pencil in the 250 basis point increase at this early stage.

Looks like I'll have to wait until 2016 to get back my expected $100 return from my $40 investment today.