pxupa divies, page-3

Hi Goodie,
The dividend stopper provision stays in place for the duration of the hybrid.
But, the company can resume dividends on the ords if they do 1 of 2 things.
1.restart paying hybrids, pay for 12 months
2.pay owing premiums, for 12 months before[so called optional distribution in prospectus]

Both end up doing the same thing.

So if ppx makes hybrid payments for the next year, after that, it can resume ords divi payments, without paying any arrears.
Hence my thoughts on the ords divi's resumption being delayed until there have been 12 months of hybrid distributions. That saves them 12 months, from memory, hybrid interest.

The next stage with PPX will be the stepup in 2 years[2.25%], hard to see this not happening, as redemption looks unlikely.
In the credit environment over the next few years, difficult to see them being able to get bank finance better than this.
Still I'll be happy to hold with a stepped up rate of 4.65% above 90day bank bill rate, on the $100 par[at present price that would be 13% plus].

Real pay day would be a takeover, with redemption at par, but unfortunately the hybrid acts as a poison pill.
Still, who knows? Might get lucky.
Pretty fairly priced at present in my opinion.
I'll be selling if it goes over $75, and would think about buying a few more if it went under $60.

cheers
disc : hold hybrid only