Samuel Terry letter to APW unitholders, page-13

@thebear, thanks for the reply. It is refreshing to have a friendly debate on HC, unfortunately many people don't respond well to viewpoints that don't accord with their own!

I'm not at all worried about timing of the wind-up process. We'll get a big payout very shortly, and if the rest takes a year or so, that doesn't bother me in the slightest. It's still going to deliver returns much, much higher than what we'd get without this action.

Yes we may receive $2, and we may receive more, and we may receive less. But if you believe the NTA figures that AIMS issue, it should be very close to $2. And if you don't believe their numbers, why would you want to stay invested in something they manage?

Re CGT, no offence intended (see first para above!) but I think turning down $2-ish because you'd have to pay some tax is a short-sighted approach. We can't avoid CGT forever. Even if your average cost base is 50cpu and you're paying the top marginal rate of tax, a $2 gross return would trigger a CGT liability of about 37cpu - hence you're still going to be a touch ahead / break even on a cash basis, but you would also have cleared a tax liability that you will have to pay at some point. And crushing that liability is a very valuable thing. Personally I am in a pretty similar situation to the hypothetical one I've just given. So, on a cash basis a wind-up would be about break-even for me, but it will dispose of a large and unfunded contingent tax liability. Hence I very strongly support the action being taken.

Finally re CGT, given the parlous state of the Federal budget I am pretty concerned that the 12 month CGT discount will be taken away at some point fairly soon, which is another reason I'm not desperate to try to delay payment of CGT for a year or two or three. But that's perhaps a discussion for another day.

FD