once in a lifetime indeed, page-45

IMO - there is a lot of unknowns out there about the assets current trading and value.

what we do know - . The assets were purchased by raising over 2 billion in cash from the market since 2002. The current market cap is about 65 million. The early purchases are in the books at purchase minus depreciation. these are worth more than book eg. powerco.and the coal terminal. These assets are regulated and generating more cash than the interest cost.

With the later asset purchases this maybe or maybe not be . eg Euroports and the alinta assets that were purchased with new ordinary shares and approx 800 million of prefs yielding a market rate plus margin and this accumulating distribution has to be paid before any distributions to ordinary shares. These are now trading at a significant discount to face value. This discount opens up the possibilty of a discounted buy back.

There is a conversion risk as these prefs could be converted to ordinary shares if the RE is not a member of the babcock group. However this would devalue the large holding of bbi shares held by BNB if the manager RE is sold out of babcock. It is therefore unlikely that these shares will knowingly be purchased from BNB while this conversion risk is possible. This line is solid BUT one flaw with this argument could be if BNB was alreday giving these away and already had a buyer for the RE? At the moment the shares are worth nothing but the RE has income.

With regard to sale prices - asset values have fallen along with market rates with a prediction of nearly zero cash rates , low bond rates, falling commodity prices and resource stocks and unknown further risk in the finanicial sector. Regulated infrastructure should attract some attention as this dust settles.