re: a superstar in the making (ITE) it&e.Hi guys, and AA, and...

re: a superstar in the making (ITE) it&e.

Hi guys, and AA, and Mamos, & thanks for the nice thoughts you expressed.... you are too kind....

I think we can easilly mange to forget ....the size of these companies(Banks) truly Massive--mind boggling-- balance sheets...

They pay their single derivative traders $6 millions ....$--US-- in half year bonusses....

Or to put it another clear way-- if they had bought the "wrong" software-- it would be thrown out like reams of pink reflex paper -- put in a cupboard to forget about-- and "expensed"-- like a unused real-estate lease in on one floor in one building -- and they would remedy it in a nano-second by buying the: "PUB Planes.".... and buy the Razor-- where $7 Millions is expensed so quickly....

Probably the IT Procurement Manager; would .... take the blame.... for a -- Banking ... "higher up".... who made the bad decison...--- coz the decision's real and relevant negative ramifications imo-- are really in terms of legacy systems -- and their inter-relatedness to other IT Operational Systems and Support Systems-- and the asociated Training, Human Resourcing, re-configurability and other Time and 'man hours' .... involved ....

If you were, to.... ask me, RIGHT now, what has been..... the cause ....to any delay/s-- thus far--....my money ....would be on, and.... I would easilly imagine..... that "procrastination"-- .... is due to ...."putting off"... the "Stock-Take" ....for want of a better term-- that would go with the INITIAL-- implementation-- and the Disruption Management Planning -- ie: how to manage while the changeover takes place-- -- and the changeover management --from one set of inter-related systems to another superior one .......

Okay then; ....... here is the link--THE LINK-- where inadvertantly you guys-- -- I think you may have been on to something..... ( I really HATE to admit this...!!!)---

... Which imo--is.... .....highly plausible-- and I would even say postuable ....and even verging on likely-- when you talk of The necessary Support Infrastructure involved.... -- "Servicing of that new enabled Infrastructure" -- and Scale and Support Systems. ...

To what do I specifically refer....?

If we Take three (3) of the major competing with (ITE) firms/companies .... in this Credit Risk arena-- who are currently now losing work -- and Preferred Vendor Status--or are at the least highly threatened... by it&e...(ITE) ...

.... I refer specifically to:

(1) Sunguard

(2) Algorythmics (owned by Fitch)

and

(3) SAS.

..... Now if you go to.... any of their respective websites -- you will see something which immediately grabs..... your attention .....

errrr .... What is that Robbo ... ??

Let's take any of one of these three multi-nationals-- ... I spoke before ... (in another post) ...about parent Co-- Fitch and Algorythmics....-- -- so this time.... for a change of scenery-- let us .... look, say at ....-- .... SAS...

.....They .... (SAS) .....have, 40, 000 Customer Sites, 10, 000 employees, and ....in Australian dollar terms-- -- about $ 2.15 Billions.... in Annual Sales Revenues.....(2005 audited figures, see the SAS.com website and go through their Annual Report). ...

Now then, if one were to use .... say Autralian listed-- CPU--Computershare--as a benchmark to get a "feel" for size-- -- that would - ....on the ASX-- make --SAS about 25-35 % ...larger than CPU -- Comptershare-- in Annual Revenue terms-- ....

So again; if one were applying similar multiples -- this makes ....SAS ... a # conservative --AUD- $6-7 Billion dollar Market Cap company -- in Australian terms-- and if their (SAS) ebita profit margins were say 17%-- nothing fancy -- that ebita profit figure ....would be in the vicinity ....of about: AUD $ 370 millions....per annum... and growing every year.

-- ..... errrr..... Your main point please ....Robbo ...???

Well, could they ....(ie: SAS) -- or... Fitch/Algo-- , or Sunguard-- for that matter-- afford say $1.00 ...(buy out share price-- for it&e.... ??-- or framed another way-- say a round $ 205 millions approx)-- to buy out (ITE) ..... ??

...to buy out it&e (ITE) ....and add this Market Advantage and Competitive advantage and scale -- to their existing operations ...??? --for which they .....already have.....; The Support Infrastructure and necesary Systems and Scale in place...... ??

- We know that answer .... I think .... !!

-Could their ... ALSO... be a high chance;.... of a semi competing-- auction ....between these three competing larger players--for (ITE) ....?-

We also; .... know ... that answer .... I think .... !!

- Now let me be clear-- my own valuation and assessments ...on.... and for... (ITE)..... stands on its own intrinsic value ..... and its own-- intrinsic merits.

... I personally-- never ....ever.... buy a share ....to hope for a Take-Over--Merger and Acquisition---- ...

I only ever, ever, buy a companies share on its own ...."stand alone".... merits.....

Repeat: never ever,. ..... Ever.

....But.... the words---- "obvious self interest" and ....

...>>>-- :-- "If we do not move first; ....What are the ramifications" -- for the other two remaining Players -- in the Big Three-- as enunciated above--(1) Sunguard, (2) Algorythmics (owned by Fitch) ..... and ... (3) SAS . ..... if one were... to move .... before the other...?

And Software/IT-- -- As a global industry-- from Microsoft, Google, Oracle, Java, IBM, Sun Microsystems, etc ..... and all the way up and down--- the food chain-- is renowned -- all the time-- globally-- for Mergers and Acquistions and Buy -Outs -- ...because .... why...??

Because ....specific ..... to this Global Industry Sector-- (IT) --- Market Size and Market Dominance and Scale .... really do work easilly and well, and so readily for them...

It can "throw off" and does throw off-- HUGE-- ....and, enormous extra scalable profits..... to synergize..... with THEIR ..... existing operations....

So To now Calm down... and neutralize this conversation-- this is partly--partly the explanation, imo, for the Emitch (EMI) and particularly the Bravura (BVA) market caps//vis a vis their PE rations-- -- in relation to their respective Ebita's.....

These global IT firms-- and particularly I think of: --(1) Sunguard, (2) Algorythmics (owned by Fitch) ..... and
(3) SAS......have heaps and heaps-- of ....free cash flow -- which they annually throw off their respective balance sheets--

And as Banking and Finance is ....a Trillion Dollar Growth industry, the whole thing .... can easilly be seen to make sense, and counts for something that ... their respective self interest/s-- finds easy to justify.....

... Desired Scale/Synergy revenue/profits Benefit ... arguments alone ... make the -- "business case " ---not difficult. ... to imagine quite easilly... and then throw ...the Other Factor; anmely Defensive Moves-- ie: The fear of the other player ...... getting market advantage.... into the mix.... or ....of (ITE) itself .....taking away.... valuable market share in their own right...... themselves....

- Okay .... back to another .... poignant and published ....and repeated (ITE) fact ... to re remind ourselves of ...

Forget .... my hypothesis ...and what... Robbo says... and what Robbo ... thinks....

-- Instead, go to the Primary (ITE) Docs.

Re-read... the (ITE) Annual Report ... from this year ....and the previous year-- and ....All of the Market Up Dates.... over the last.... say 24 months-- and also particularly -- the last say ....9 months-- and the (ITE) most recent AGM Presentation.... and re-read for yourelves-- the EXPLICT..... stated-- clear and unambiguous reasons given-- for some of the recent (ITE) Director executive appointments ... .

And The Recurring Themes and Reason/s often stated is...what...??

Answer: As stated clearly frequently by (ITE)... ..---- Strategic Mergers .... and Acquistions ...--

Okay then:-- I will extend this... maybe... one step further ....and be a bit cheeky ....and naughty......

In my view-- the (ITE) AIM listing-- was/ is ....largely tied up --.... with this above strategy ...... stated by (ITE) --repeatedly-- strategy in mind....

The Bigger Question is ... -- ?? :

Can you now ... join.... the last of the DOTS-- in respect to how (AIM) is relevant.... to what.... I actually refer ... ???

Do we need to Prick your imaginations ... just a little more... to join the Dots...??

....Ohhhhhh..... okay then... if I must....


Add Five New (ITE)-- Client Majors-- USA, Canada, and/or Europe or combo of above -- yes ....add .... just.... Five -- not even the Six/Seven stated-- Majors ....to (ITE's ) client lists ... and then imagine you were in a Board Room -- in say 3 weeks time-- of one of the Three (ITE) Competitors.....

Now ....before you close your eyes ....to imagine this--imagine also that 30 of your existing Bank Clinets--as say SAS, Fitch etc etc--... as Three Year Contracts.... are now due to expire-- and are coming out of contract--in Calendar year 2007-- and that they will..... all ... this year--2007--- go back out.... to Tender and.... to (RFP's) ---Requests for Proposals....

--Now imagine, that having lost the last 5-6-7--.... Big Banks to (ITE) as THE preferred Vendor and.... The Provider.... of Risk Mgt Software for Credit Risk--..... the Sales & Marketing Director of the Big 3-- is asked the following question-- "Bob"-- with our exisiting .... errrr.... Sales Pipe line-- how many of those companies-- in that Pipeline-- is (ITE) also bidding and competing against us ... Bob---....??? ...

Bob's answer ... errrr....Mack, (ITE) have lobbed a competitive Tender.... and Repinse to every... single... one of them ....Mack ...

Mack to Bob-- "What is (ITE's) historical--recent last 2 years--percentage strike rate of winning the tenders they respond to Bob..."..

..errrr... so far globally-- Mack ....it is not bad-- The (ITE) it&e win rate-- is known throughout those in the know--in the INDUSTRY--- as being about a 95% Win Rate-- of the Shortlisted RFP's .... which-- they go in for.....

Actually Mack, here is the List --before-- yes BEFORE-- ... we put the Five --Six-- new (ITE) Clients; whcih they ahve jsut won and added to this list Mack ....:


• Chicago Mercantile Exchange, (Worlds largest Commodity Stock Exchange),

• Australian Stock Exchange (ASX),

• Sun-Corp,

• KBC Bank (Europe--Belgium).

• Queensland Treasury Department.

• The Tier One Asian Bank recently apart from HSBC.

• Bear Sterns. (USA) ,

• Fortis Bank.

• HSBC in Hong Kong
-
• HSBC in London g Stage Two and Live and now HSBC out of London (United Kingdom). ....

• KBC Bank (Europe--Belgium),

• LLBW Bank

• Commonwealth Bank of Australia (CBA),

• National Australia Bank (NAB),

• Westpac Bank (WBC),

• BT Financial Group --United Kingdom,

• Macquarie Bank,

• Zivnostekska--Germany & Switzerland)--Bank,

• Brown Bros Harriman Bank operating in UK and USA,

• Penison France --Insurance, Superannuation and Banking,

• Post Bank Germany/Europe,

• ANZ Bank –Australia and New Zealand.

--------------------- ....Bob places this above list --plus the Five new Global Banks-- on the Board Room table of the other companies---and gives Mack and other Directors a copy ------------------------

Mack to Bob-- "Geee.... thanks Bob--- that List and information about our cometitive situation-- and our Sales Pipe Line status-- is... errrr.....very helpful.....Bob.... great... thanks.....
"...

Naughty final thought--??-- Clue :

imo-- " very interesting things ....Will ....probably happen, ( by deducing from some semblance of self interest and logic.... (not ITE's self interest either)-- ... in my view-- and by Uncle Max's view--(from The PUB) -- and Chief Leading Airman of Pub Planes-- deductions-- and ...as you ALL now know--..... Maxie and I ....are .... errrr.... not much good ..... at deductive analysis...-- but.... anyway...-- here it is-- this to what I refer; will be ....in the thick of happening,..... (80% probability--imo--and Uncle Maxies....)-- ... by approx-- late February of 2007. ....

errrr ..... tomorrow.... btw --just in case you forgot-- .... is .... January 15 ....

-- Just some.... small bits of .... errrr.... "Food ....for.... thought" .....

Kindest Regards,

Robbo.

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